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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is Rayonier Advanced Materials (RYAM - Free Report) . RYAM is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 8.28, which compares to its industry's average of 9.73. RYAM's Forward P/E has been as high as 33.63 and as low as 7.98, with a median of 11.58, all within the past year.
Another valuation metric that we should highlight is RYAM's P/B ratio of 1.25. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. RYAM's current P/B looks attractive when compared to its industry's average P/B of 1.97. Over the past 12 months, RYAM's P/B has been as high as 3.83 and as low as 1.11, with a median of 1.49.
Finally, our model also underscores that RYAM has a P/CF ratio of 2.41. 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. RYAM's current P/CF looks attractive when compared to its industry's average P/CF of 5.81. Within the past 12 months, RYAM's P/CF has been as high as 8.07 and as low as 2.22, with a median of 2.88.
These are only a few of the key metrics included in Rayonier Advanced Materials'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, RYAM looks like an impressive value stock at the moment.