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Should Value Investors Buy Federated Hermes (FHI) Stock?
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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.
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 Federated Hermes (FHI - Free Report) . FHI is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.54, while its industry has an average P/E of 13.37. FHI's Forward P/E has been as high as 13.06 and as low as 8.68, with a median of 9.91, all within the past year.
We also note that FHI holds a PEG ratio of 0.68. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FHI's PEG compares to its industry's average PEG of 0.89. Over the past 52 weeks, FHI's PEG has been as high as 1.46 and as low as 0.68, with a median of 0.98.
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. FHI has a P/S ratio of 2.25. This compares to its industry's average P/S of 3.1.
Finally, we should also recognize that FHI has a P/CF ratio of 12.35. 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. FHI's current P/CF looks attractive when compared to its industry's average P/CF of 31.31. Over the past 52 weeks, FHI's P/CF has been as high as 12.68 and as low as 7.98, with a median of 10.34.
These are only a few of the key metrics included in Federated Hermes's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, FHI looks like an impressive value stock at the moment.
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Should Value Investors Buy Federated Hermes (FHI) Stock?
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.
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 Federated Hermes (FHI - Free Report) . FHI is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.54, while its industry has an average P/E of 13.37. FHI's Forward P/E has been as high as 13.06 and as low as 8.68, with a median of 9.91, all within the past year.
We also note that FHI holds a PEG ratio of 0.68. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FHI's PEG compares to its industry's average PEG of 0.89. Over the past 52 weeks, FHI's PEG has been as high as 1.46 and as low as 0.68, with a median of 0.98.
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. FHI has a P/S ratio of 2.25. This compares to its industry's average P/S of 3.1.
Finally, we should also recognize that FHI has a P/CF ratio of 12.35. 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. FHI's current P/CF looks attractive when compared to its industry's average P/CF of 31.31. Over the past 52 weeks, FHI's P/CF has been as high as 12.68 and as low as 7.98, with a median of 10.34.
These are only a few of the key metrics included in Federated Hermes's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, FHI looks like an impressive value stock at the moment.