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Should Value Investors Buy LCNB (LCNB) 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 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.

One company to watch right now is LCNB (LCNB - Free Report) . LCNB is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 9.85, which compares to its industry's average of 10.26. Over the past year, LCNB's Forward P/E has been as high as 14.00 and as low as 8.06, with a median of 9.40.

Another notable valuation metric for LCNB is its P/B ratio of 0.86. 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 1.10. Over the past year, LCNB's P/B has been as high as 0.99 and as low as 0.75, with a median of 0.83.

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. LCNB has a P/S ratio of 1.78. This compares to its industry's average P/S of 1.95.

Finally, investors will want to recognize that LCNB has a P/CF ratio of 11.23. 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. LCNB's P/CF compares to its industry's average P/CF of 16.43. LCNB's P/CF has been as high as 29.50 and as low as 9.93, with a median of 14.83, all within the past year.

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


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