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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
One company value investors might notice is Target (TGT - Free Report) . TGT is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 15.04 right now. For comparison, its industry sports an average P/E of 20.20. Over the past 52 weeks, TGT's Forward P/E has been as high as 16.96 and as low as 12.34, with a median of 14.41.
Another valuation metric that we should highlight is TGT's P/B ratio of 3.94. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. TGT's current P/B looks attractive when compared to its industry's average P/B of 6.86. TGT's P/B has been as high as 4.21 and as low as 2.64, with a median of 3.51, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TGT has a P/S ratio of 0.6. This compares to its industry's average P/S of 0.69.
Finally, investors will want to recognize that TGT has a P/CF ratio of 7.97. 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. TGT's current P/CF looks attractive when compared to its industry's average P/CF of 14.67. TGT's P/CF has been as high as 8.54 and as low as 5.89, with a median of 7.52, all within the past year.
These are only a few of the key metrics included in Target'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, TGT looks like an impressive value stock at the moment.
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Is Target (TGT) a Great Value Stock Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
One company value investors might notice is Target (TGT - Free Report) . TGT is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 15.04 right now. For comparison, its industry sports an average P/E of 20.20. Over the past 52 weeks, TGT's Forward P/E has been as high as 16.96 and as low as 12.34, with a median of 14.41.
Another valuation metric that we should highlight is TGT's P/B ratio of 3.94. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. TGT's current P/B looks attractive when compared to its industry's average P/B of 6.86. TGT's P/B has been as high as 4.21 and as low as 2.64, with a median of 3.51, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TGT has a P/S ratio of 0.6. This compares to its industry's average P/S of 0.69.
Finally, investors will want to recognize that TGT has a P/CF ratio of 7.97. 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. TGT's current P/CF looks attractive when compared to its industry's average P/CF of 14.67. TGT's P/CF has been as high as 8.54 and as low as 5.89, with a median of 7.52, all within the past year.
These are only a few of the key metrics included in Target'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, TGT looks like an impressive value stock at the moment.