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Should Value Investors Buy Kamada (KMDA) Stock?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

Kamada (KMDA - Free Report) is a stock many investors are watching right now. KMDA is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 21.37. This compares to its industry's average Forward P/E of 37.93. Over the last 12 months, KMDA's Forward P/E has been as high as 26.70 and as low as 17.00, with a median of 20.15.

Investors should also recognize that KMDA has a P/B ratio of 1.63. 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 solid versus its industry's average P/B of 3.16. KMDA's P/B has been as high as 1.85 and as low as 1.11, with a median of 1.35, over the past year.

Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. KMDA has a P/S ratio of 2.46. This compares to its industry's average P/S of 5.47.

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


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