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Should Value Investors Buy VAREX IMAGING (VREX) Stock?
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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is VAREX IMAGING (VREX - Free Report) . VREX is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 12.15 right now. For comparison, its industry sports an average P/E of 21.66. Over the past year, VREX's Forward P/E has been as high as 26.48 and as low as 11.66, with a median of 19.04.
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. VREX has a P/S ratio of 0.58. This compares to its industry's average P/S of 1.69.
These figures are just a handful of the metrics value investors tend to look at, but they help show that VAREX IMAGING is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VREX feels like a great value stock at the moment.
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Should Value Investors Buy VAREX IMAGING (VREX) Stock?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is VAREX IMAGING (VREX - Free Report) . VREX is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 12.15 right now. For comparison, its industry sports an average P/E of 21.66. Over the past year, VREX's Forward P/E has been as high as 26.48 and as low as 11.66, with a median of 19.04.
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. VREX has a P/S ratio of 0.58. This compares to its industry's average P/S of 1.69.
These figures are just a handful of the metrics value investors tend to look at, but they help show that VAREX IMAGING is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VREX feels like a great value stock at the moment.