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Should Value Investors Buy Entravision Communications (EVC) Stock?

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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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One stock to keep an eye on is Entravision Communications (EVC - Free Report) . EVC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 13.61, while its industry has an average P/E of 19.42. EVC's Forward P/E has been as high as 65.08 and as low as 13.30, with a median of 24.08, all within the past year.

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. EVC has a P/S ratio of 0.86. This compares to its industry's average P/S of 1.22.

Finally, investors will want to recognize that EVC has a P/CF ratio of 8.11. 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 stock's P/CF looks attractive against its industry's average P/CF of 25.31. EVC's P/CF has been as high as 14.48 and as low as 2.01, with a median of 8.44, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Entravision Communications is likely undervalued currently. And when considering the strength of its earnings outlook, EVC sticks out at as one of the market's strongest value stocks.


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