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Is Hallmark Financial (HALL) a Great Value Stock Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Hallmark Financial (HALL - Free Report) is a stock many investors are watching right now. HALL is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 9.36 right now. For comparison, its industry sports an average P/E of 24.58. Over the past year, HALL's Forward P/E has been as high as 13.38 and as low as 8.70, with a median of 11.26.

Investors should also recognize that HALL has a P/B ratio of 0.78. 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 stock's P/B looks solid versus its industry's average P/B of 1.51. HALL's P/B has been as high as 0.79 and as low as 0.68, with a median of 0.74, 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. HALL has a P/S ratio of 0.53. This compares to its industry's average P/S of 1.22.

Finally, we should also recognize that HALL has a P/CF ratio of 12.84. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 33.51. Within the past 12 months, HALL's P/CF has been as high as 21.29 and as low as -134.13, with a median of 11.54.

These are only a few of the key metrics included in Hallmark Financial'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, HALL looks like an impressive value stock at the moment.


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