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Is Donnelley Financial Solutions (DFIN) a Great Value Stock Right Now?

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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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Donnelley Financial Solutions (DFIN - Free Report) is a stock many investors are watching right now. DFIN is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 17.45 right now. For comparison, its industry sports an average P/E of 20.28. DFIN's Forward P/E has been as high as 18.33 and as low as 13.56, with a median of 16.54, all within the past year.

Finally, investors should note that DFIN has a P/CF ratio of 9.90. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 14.81. Over the past year, DFIN's P/CF has been as high as 12.80 and as low as 7.09, with a median of 10.59.

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

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