Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put CYS Investments, Inc. stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, CYS Investments has a trailing twelve months PE ratio of 8.05, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 20.08. If we focus on the long-term PE trend, CYS Investments’ current PE level puts it below its midpoint over the past five years, with the number having fallen gradually over the past few months.
This decrease could be due to the fact that the stock’s price has been decreasing somewhat while earnings have been fairly constant over the past few months. Both of these trends have had an deflating effect on the PE ratio.
Further, the stock’s PE also compares favorably with the Zacks classified Finance sector’s trailing twelve months PE ratio, which stands at 16.83. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that CYS Investments has a forward PE ratio (price relative to this year’s earnings) of 7.72, so it is fair to say that a slightly more value-oriented path may be ahead for CYS Investments stock in the near term too.
P/S Ratio
Another key metric to note is the Price/Sales ratio. This approach compares a given stock’s price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.
Right now, CYS Investments has a P/S ratio of about 4.08. This higher than the S&P 500 average, which comes in at 3.28 right now. However, as we can see in the chart below, this is significantly below the highs for this stock in particular over the past few years.
Meanwhile, if we focus on the stock’s long term trend, we see that the stock’s multiple has always traded higher than the overall market. In fact, the current level is below the median range for the company in the observed period. Hence, we might conclude that in light of past trends, the stock seems to be trading at a low valuation from a P/S perspective.
Broad Value Outlook
In aggregate, CYS Investments currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes CYS Investments a solid choice for value investors, and some of its other key metrics make this pretty clear too.
For example, the PEG ratio for CYS Investments is just 1.54, a level that is lower than the industry average of 1.66. The PEG ratio is a modified PE ratio that takes into account the stock’s earnings growth rate.
What About the Stock Overall?
Though CYS Investments might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘F’ and a Momentum score of ‘B’. This gives CYS a Zacks VGM score—or its overarching fundamental grade—of ‘C’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimate has been mostly bullish. The full year estimate has seen one up and none down in the past sixty days.
This has had just a small impact on the consensus estimate though as the full year estimate has inched higher by 0.1%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
CYS Investments, Inc. Price and Consensus
CYS Investments, Inc. Price and Consensus | CYS Investments, Inc. Quote
This bullish trend is why the stock boasts a Zacks Rank #2 (Buy) and why we are expecting outperformance from the company in the near term.
Bottom Line
CYS Investments is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Despite having a Zacks Rank #2, the stock belongs to an industry which is ranked among the Bottom 40%, which indicates that broader factors are unfavorable for the company. In fact, over the past three years, the Zacks categorized REIT-Mortgage Trust industry has clearly underperformed the broader market, as you can see below:
So, value investors might want to wait for broader factors to turn around in this name first, but once that happens, this stock could be a compelling pick.
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Is CYS Investments (CYS) a Top Choice for Value Investors?
Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put CYS Investments, Inc. stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, CYS Investments has a trailing twelve months PE ratio of 8.05, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 20.08. If we focus on the long-term PE trend, CYS Investments’ current PE level puts it below its midpoint over the past five years, with the number having fallen gradually over the past few months.
This decrease could be due to the fact that the stock’s price has been decreasing somewhat while earnings have been fairly constant over the past few months. Both of these trends have had an deflating effect on the PE ratio.
Further, the stock’s PE also compares favorably with the Zacks classified Finance sector’s trailing twelve months PE ratio, which stands at 16.83. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that CYS Investments has a forward PE ratio (price relative to this year’s earnings) of 7.72, so it is fair to say that a slightly more value-oriented path may be ahead for CYS Investments stock in the near term too.
P/S Ratio
Another key metric to note is the Price/Sales ratio. This approach compares a given stock’s price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.
Right now, CYS Investments has a P/S ratio of about 4.08. This higher than the S&P 500 average, which comes in at 3.28 right now. However, as we can see in the chart below, this is significantly below the highs for this stock in particular over the past few years.
Meanwhile, if we focus on the stock’s long term trend, we see that the stock’s multiple has always traded higher than the overall market. In fact, the current level is below the median range for the company in the observed period. Hence, we might conclude that in light of past trends, the stock seems to be trading at a low valuation from a P/S perspective.
Broad Value Outlook
In aggregate, CYS Investments currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes CYS Investments a solid choice for value investors, and some of its other key metrics make this pretty clear too.
For example, the PEG ratio for CYS Investments is just 1.54, a level that is lower than the industry average of 1.66. The PEG ratio is a modified PE ratio that takes into account the stock’s earnings growth rate.
What About the Stock Overall?
Though CYS Investments might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘F’ and a Momentum score of ‘B’. This gives CYS a Zacks VGM score—or its overarching fundamental grade—of ‘C’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimate has been mostly bullish. The full year estimate has seen one up and none down in the past sixty days.
This has had just a small impact on the consensus estimate though as the full year estimate has inched higher by 0.1%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
CYS Investments, Inc. Price and Consensus
CYS Investments, Inc. Price and Consensus | CYS Investments, Inc. Quote
This bullish trend is why the stock boasts a Zacks Rank #2 (Buy) and why we are expecting outperformance from the company in the near term.
Bottom Line
CYS Investments is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Despite having a Zacks Rank #2, the stock belongs to an industry which is ranked among the Bottom 40%, which indicates that broader factors are unfavorable for the company. In fact, over the past three years, the Zacks categorized REIT-Mortgage Trust industry has clearly underperformed the broader market, as you can see below:
So, value investors might want to wait for broader factors to turn around in this name first, but once that happens, this stock could be a compelling pick.
Just Released – Driverless Cars: Your Roadmap to Mega-Profits Today
In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>