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Are Investors Undervaluing Sierra Bancorp (BSRR) Right Now?

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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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Sierra Bancorp (BSRR - Free Report) is a stock many investors are watching right now. BSRR 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 10.99, which compares to its industry's average of 11.07. Over the past 52 weeks, BSRR's Forward P/E has been as high as 14.67 and as low as 10.59, with a median of 12.56.

Another valuation metric that we should highlight is BSRR's P/B ratio of 1.35. 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. BSRR's current P/B looks attractive when compared to its industry's average P/B of 1.42. Over the past year, BSRR's P/B has been as high as 1.81 and as low as 1.30, with a median of 1.54.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BSRR has a P/S ratio of 3.04. This compares to its industry's average P/S of 3.35.

Finally, investors should note that BSRR has a P/CF ratio of 8.84. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 10.81. Within the past 12 months, BSRR's P/CF has been as high as 13.83 and as low as 8.53, with a median of 10.91.

These are just a handful of the figures considered in Sierra Bancorp'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 BSRR is an impressive value stock right now.


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