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.
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.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
EnLink Midstream Partners, LP (ENLK - Free Report) is a stock many investors are watching right now. ENLK is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.
Another notable valuation metric for ENLK is its P/B ratio of 1.55. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.64. Over the past year, ENLK's P/B has been as high as 1.96 and as low as 1.04, with a median of 1.60.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ENLK has a P/S ratio of 0.78. This compares to its industry's average P/S of 2.14.
Finally, our model also underscores that ENLK has a P/CF ratio of 6.29. 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. ENLK's current P/CF looks attractive when compared to its industry's average P/CF of 9.55. ENLK's P/CF has been as high as 9.24 and as low as 6.15, with a median of 7.62, all within the past year.
These are just a handful of the figures considered in EnLink Midstream Partners, LP'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 ENLK is an impressive value stock right now.