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Should Value Investors Buy United Natural Foods (UNFI) 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

One company value investors might notice is United Natural Foods (UNFI - Free Report) . UNFI is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.

We should also highlight that UNFI has a P/B ratio of 1.11. 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 1.67. Over the past year, UNFI's P/B has been as high as 1.27 and as low as 0.56, with a median of 0.99.

Finally, investors will want to recognize that UNFI has a P/CF ratio of 6.80. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 10.64. Over the past year, UNFI's P/CF has been as high as 8.41 and as low as 4.47, with a median of 6.37.

These are just a handful of the figures considered in United Natural Foods'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 UNFI is an impressive value stock right now.

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