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Should Value Investors Buy Eagle Bancorp Montana (EBMT) Stock?

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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 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 company to watch right now is Eagle Bancorp Montana (EBMT - Free Report) . EBMT is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 9.82, which compares to its industry's average of 9.87. Over the past year, EBMT's Forward P/E has been as high as 13.92 and as low as 8.84, with a median of 10.08.

Investors should also recognize that EBMT has a P/B ratio of 0.78. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.92. Over the past 12 months, EBMT's P/B has been as high as 0.83 and as low as 0.67, with a median of 0.75.

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. EBMT has a P/S ratio of 1.05. This compares to its industry's average P/S of 2.02.

Finally, investors will want to recognize that EBMT has a P/CF ratio of 6.16. 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. EBMT's current P/CF looks attractive when compared to its industry's average P/CF of 14.44. Over the past year, EBMT's P/CF has been as high as 7.56 and as low as 5.51, with a median of 6.35.

These are just a handful of the figures considered in Eagle Bancorp Montana'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 EBMT is an impressive value stock right now.


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