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Should Value Investors Buy Evertec (EVTC) Stock?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 stock to keep an eye on is Evertec (EVTC - Free Report) . EVTC is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 9.42, while its industry has an average P/E of 19.53. EVTC's Forward P/E has been as high as 11.49 and as low as 9.26, with a median of 10.35, all within the past year.

Investors should also recognize that EVTC has a P/B ratio of 3.5. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 9.27. Over the past 12 months, EVTC's P/B has been as high as 5.07 and as low as 3.41, with a median of 4.27.

Finally, investors will want to recognize that EVTC has a P/CF ratio of 8.19. 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 15.04. EVTC's P/CF has been as high as 11.11 and as low as 7.89, with a median of 8.96, all within the past year.

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

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