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Is Eagle Bancorp Montana (EBMT) Stock Undervalued Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 stock to keep an eye on is Eagle Bancorp Montana (EBMT - Free Report) . EBMT is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 9.4 right now. For comparison, its industry sports an average P/E of 10.93. Over the last 12 months, EBMT's Forward P/E has been as high as 13.92 and as low as 8.84, with a median of 10.30.

Investors should also recognize that EBMT has a P/B ratio of 0.74. 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 attractive against its industry's average P/B of 2.08. Within the past 52 weeks, EBMT's P/B has been as high as 0.83 and as low as 0.66, with a median of 0.75.

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. EBMT has a P/S ratio of 1.1. This compares to its industry's average P/S of 2.07.

Finally, our model also underscores that EBMT has a P/CF ratio of 5.87. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. EBMT's P/CF compares to its industry's average P/CF of 15.26. Over the past 52 weeks, EBMT's P/CF has been as high as 7.56 and as low as 5.51, with a median of 6.53.

Value investors will likely look at more than just these metrics, but the above data helps show that Eagle Bancorp Montana is likely undervalued currently. And when considering the strength of its earnings outlook, EBMT sticks out as one of the market's strongest value stocks.


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