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Should Value Investors Buy Virco Manufacturing (VIRC) 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One company value investors might notice is Virco Manufacturing (VIRC - Free Report) . VIRC is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 7.75. This compares to its industry's average Forward P/E of 9.96. VIRC's Forward P/E has been as high as 11.62 and as low as 6.52, with a median of 8.01, all within the past year.

Investors should also recognize that VIRC has a P/B ratio of 1.26. 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 solid versus its industry's average P/B of 1.64. Within the past 52 weeks, VIRC's P/B has been as high as 3.03 and as low as 1.19, with a median of 1.56.

Finally, our model also underscores that VIRC has a P/CF ratio of 5.03. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. VIRC's P/CF compares to its industry's average P/CF of 7.34. Over the past 52 weeks, VIRC's P/CF has been as high as 9.19 and as low as 4.72, with a median of 6.17.

These are just a handful of the figures considered in Virco Manufacturing'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 VIRC is an impressive value stock right now.


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