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.
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.
MoneyGram (MGI - Free Report) is a stock many investors are watching right now. MGI is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 8.02, while its industry has an average P/E of 10.30. Over the past year, MGI's Forward P/E has been as high as 14.67 and as low as 5.46, with a median of 10.20.
Investors will also notice that MGI has a PEG ratio of 0.89. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MGI's industry has an average PEG of 1.07 right now.
Finally, investors should note that MGI has a P/CF ratio of 3.61. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.92. Within the past 12 months, MGI's P/CF has been as high as 8.37 and as low as 3.61, with a median of 5.50.
These are only a few of the key metrics included in MoneyGram'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, MGI looks like an impressive value stock at the moment.