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Are Investors Undervaluing Virco Manufacturing (VIRC) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 Virco Manufacturing (VIRC - Free Report) . VIRC is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with P/E ratio of 9.44 right now. For comparison, its industry sports an average P/E of 13.74. Over the last 12 months, VIRC's Forward P/E has been as high as 9.44 and as low as 4.22, with a median of 5.51.

Another notable valuation metric for VIRC is its P/B ratio of 2.81. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 3.46. VIRC's P/B has been as high as 2.81 and as low as 0.86, with a median of 1.58, over the past year.

Finally, our model also underscores that VIRC has a P/CF ratio of 8.37. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. VIRC's P/CF compares to its industry's average P/CF of 14.02. VIRC's P/CF has been as high as 8.37 and as low as 2.28, with a median of 4.22, all within the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Virco Manufacturing is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VIRC feels like a great value stock at the moment.

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