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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 value investors might notice is Allstate (ALL - Free Report) . ALL is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A.
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. ALL has a P/S ratio of 0.82. This compares to its industry's average P/S of 1.31.
Finally, our model also underscores that ALL has a P/CF ratio of 8.66. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 13.18. Within the past 12 months, ALL's P/CF has been as high as 14.16 and as low as 8.07, with a median of 10.58.
Investors could also keep in mind Mercury General (MCY - Free Report) , another Insurance - Property and Casualty stock with a Zacks Rank of #1 (Strong Buy) and Value grade of A.
Additionally, Mercury General has a P/B ratio of 2.24 while its industry's price-to-book ratio sits at 1.50. For MCY, this valuation metric has been as high as 2.35, as low as 1.34, with a median of 1.92 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Allstate and Mercury General are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ALL and MCY feels like a great value stock at the moment.
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Should Value Investors Buy Allstate (ALL) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 value investors might notice is Allstate (ALL - Free Report) . ALL is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A.
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. ALL has a P/S ratio of 0.82. This compares to its industry's average P/S of 1.31.
Finally, our model also underscores that ALL has a P/CF ratio of 8.66. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 13.18. Within the past 12 months, ALL's P/CF has been as high as 14.16 and as low as 8.07, with a median of 10.58.
Investors could also keep in mind Mercury General (MCY - Free Report) , another Insurance - Property and Casualty stock with a Zacks Rank of #1 (Strong Buy) and Value grade of A.
Additionally, Mercury General has a P/B ratio of 2.24 while its industry's price-to-book ratio sits at 1.50. For MCY, this valuation metric has been as high as 2.35, as low as 1.34, with a median of 1.92 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Allstate and Mercury General are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ALL and MCY feels like a great value stock at the moment.