Back to top

Image: Bigstock

Should Value Investors Buy CACI International (CACI) Stock?

Read MoreHide Full Article

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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 CACI International (CACI - Free Report) . CACI is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 16.71, which compares to its industry's average of 18.99. Over the past year, CACI's Forward P/E has been as high as 20.63 and as low as 13.45, with a median of 17.30.

Investors should also note that CACI holds a PEG ratio of 1.67. 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. CACI's PEG compares to its industry's average PEG of 1.69. Within the past year, CACI's PEG has been as high as 2.06 and as low as 1.34, with a median of 1.76.

Another notable valuation metric for CACI is its P/B ratio of 2. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 3.01. CACI's P/B has been as high as 2.33 and as low as 1.55, with a median of 1.99, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CACI has a P/S ratio of 0.98. This compares to its industry's average P/S of 1.29.

These are just a handful of the figures considered in CACI International'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 CACI is an impressive value stock right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


CACI International, Inc. (CACI) - free report >>

Published in