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Should Value Investors Buy Charles River Associates (CRAI) Stock?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Charles River Associates (CRAI - Free Report) . CRAI is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 25.21, which compares to its industry's average of 27.84. Over the past year, CRAI's Forward P/E has been as high as 25.21 and as low as 13.70, with a median of 17.85.

We also note that CRAI holds a PEG ratio of 1.58. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. CRAI's industry currently sports an average PEG of 2.95. CRAI's PEG has been as high as 1.92 and as low as 1.05, with a median of 1.37, all within the past year.

Another notable valuation metric for CRAI is its P/B ratio of 4.89. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 6.29. CRAI's P/B has been as high as 4.89 and as low as 2.81, with a median of 3.52, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CRAI has a P/S ratio of 1.67. This compares to its industry's average P/S of 2.14.

Finally, we should also recognize that CRAI has a P/CF ratio of 16.41. 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. This stock's P/CF looks attractive against its industry's average P/CF of 18.88. CRAI's P/CF has been as high as 16.41 and as low as 9.61, with a median of 11.38, all within the past year.

If you're looking for another solid Consulting Services value stock, take a look at The Hackett Group (HCKT - Free Report) . HCKT is a # 2 (Buy) stock with a Value score of A.

The Hackett Group is currently trading with a Forward P/E ratio of 13.90 while its PEG ratio sits at 1.03. Both of the company's metrics compare favorably to its industry's average P/E of 27.84 and average PEG ratio of 2.95.

Over the past year, HCKT's P/E has been as high as 15.32, as low as 10.98, with a median of 13.68; its PEG ratio has been as high as 1.13, as low as 0.81, with a median of 1.37 during the same time period.

Furthermore, The Hackett Group holds a P/B ratio of 7.35 and its industry's price-to-book ratio is 6.29. HCKT's P/B has been as high as 9.93, as low as 6.65, with a median of 7.92 over the past 12 months.

These are just a handful of the figures considered in Charles River Associates and The Hackett 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 CRAI and HCKT is an impressive value stock right now.


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