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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 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 Macy's (M - Free Report) . M is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 6.01. This compares to its industry's average Forward P/E of 9.44. M's Forward P/E has been as high as 8.39 and as low as 3.84, with a median of 6.75, all within the past year.
M is also sporting a PEG ratio of 0.60. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. M's industry currently sports an average PEG of 1.18. Over the past 52 weeks, M's PEG has been as high as 0.64 and as low as 0.32, with a median of 0.43.
Another notable valuation metric for M is its P/B ratio of 1.11. 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 stock's P/B looks attractive against its industry's average P/B of 1.92. Within the past 52 weeks, M's P/B has been as high as 1.43 and as low as 0.69, with a median of 1.22.
Finally, we should also recognize that M has a P/CF ratio of 5.15. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 8.22. M's P/CF has been as high as 6.25 and as low as 1.77, with a median of 3.49, all within the past year.
These are only a few of the key metrics included in Macy's's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, M looks like an impressive value stock at the moment.
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Are Investors Undervaluing Macy's (M) 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 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 Macy's (M - Free Report) . M is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 6.01. This compares to its industry's average Forward P/E of 9.44. M's Forward P/E has been as high as 8.39 and as low as 3.84, with a median of 6.75, all within the past year.
M is also sporting a PEG ratio of 0.60. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. M's industry currently sports an average PEG of 1.18. Over the past 52 weeks, M's PEG has been as high as 0.64 and as low as 0.32, with a median of 0.43.
Another notable valuation metric for M is its P/B ratio of 1.11. 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 stock's P/B looks attractive against its industry's average P/B of 1.92. Within the past 52 weeks, M's P/B has been as high as 1.43 and as low as 0.69, with a median of 1.22.
Finally, we should also recognize that M has a P/CF ratio of 5.15. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 8.22. M's P/CF has been as high as 6.25 and as low as 1.77, with a median of 3.49, all within the past year.
These are only a few of the key metrics included in Macy's's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, M looks like an impressive value stock at the moment.