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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Target (TGT - Free Report) . TGT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 17.26, which compares to its industry's average of 28.70. Over the last 12 months, TGT's Forward P/E has been as high as 18.70 and as low as 12.31, with a median of 15.02.
Investors should also note that TGT holds a PEG ratio of 1.52. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TGT's industry currently sports an average PEG of 2.68. Over the last 12 months, TGT's PEG has been as high as 1.63 and as low as 0.87, with a median of 1.05.
Another valuation metric that we should highlight is TGT's P/B ratio of 5.71. The P/B ratio pits a stock's market value against 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 13.28. TGT's P/B has been as high as 6.72 and as low as 3.94, with a median of 5.17, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TGT has a P/S ratio of 0.71. This compares to its industry's average P/S of 0.89.
Finally, investors will want to recognize that TGT has a P/CF ratio of 11.09. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 27.65. Over the past 52 weeks, TGT's P/CF has been as high as 13.84 and as low as 7.72, with a median of 10.14.
Value investors will likely look at more than just these metrics, but the above data helps show that Target is likely undervalued currently. And when considering the strength of its earnings outlook, TGT sticks out at as one of the market's strongest value stocks.
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Is Target (TGT) Stock Undervalued Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Target (TGT - Free Report) . TGT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 17.26, which compares to its industry's average of 28.70. Over the last 12 months, TGT's Forward P/E has been as high as 18.70 and as low as 12.31, with a median of 15.02.
Investors should also note that TGT holds a PEG ratio of 1.52. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TGT's industry currently sports an average PEG of 2.68. Over the last 12 months, TGT's PEG has been as high as 1.63 and as low as 0.87, with a median of 1.05.
Another valuation metric that we should highlight is TGT's P/B ratio of 5.71. The P/B ratio pits a stock's market value against 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 13.28. TGT's P/B has been as high as 6.72 and as low as 3.94, with a median of 5.17, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TGT has a P/S ratio of 0.71. This compares to its industry's average P/S of 0.89.
Finally, investors will want to recognize that TGT has a P/CF ratio of 11.09. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 27.65. Over the past 52 weeks, TGT's P/CF has been as high as 13.84 and as low as 7.72, with a median of 10.14.
Value investors will likely look at more than just these metrics, but the above data helps show that Target is likely undervalued currently. And when considering the strength of its earnings outlook, TGT sticks out at as one of the market's strongest value stocks.