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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 US Foods (USFD - Free Report) . USFD is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
Investors will also notice that USFD has a PEG ratio of 1.00. 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. USFD's PEG compares to its industry's average PEG of 1.20. USFD's PEG has been as high as 1.05 and as low as 0.70, with a median of 0.87, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. USFD has a P/S ratio of 0.5. This compares to its industry's average P/S of 0.97.
These are just a handful of the figures considered in US Foods's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that USFD is an impressive value stock right now.
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Should Value Investors Buy US Foods (USFD) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 US Foods (USFD - Free Report) . USFD is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
Investors will also notice that USFD has a PEG ratio of 1.00. 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. USFD's PEG compares to its industry's average PEG of 1.20. USFD's PEG has been as high as 1.05 and as low as 0.70, with a median of 0.87, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. USFD has a P/S ratio of 0.5. This compares to its industry's average P/S of 0.97.
These are just a handful of the figures considered in US Foods's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that USFD is an impressive value stock right now.