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Are Investors Undervaluing The RMR Group (RMR) Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is The RMR Group (RMR - Free Report) . RMR is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 13.41, while its industry has an average P/E of 23.17. Over the past 52 weeks, RMR's Forward P/E has been as high as 15.38 and as low as 10.10, with a median of 12.76.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. RMR has a P/S ratio of 0.86. This compares to its industry's average P/S of 1.28.

Finally, investors should note that RMR has a P/CF ratio of 6.28. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. RMR's P/CF compares to its industry's average P/CF of 8.19. Within the past 12 months, RMR's P/CF has been as high as 23.11 and as low as 5.12, with a median of 6.57.

These are just a handful of the figures considered in The RMR Group's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that RMR is an impressive value stock right now.


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