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Are Investors Undervaluing Sonic Automotive (SAH) 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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
Sonic Automotive (SAH - Free Report) is a stock many investors are watching right now. SAH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Another notable valuation metric for SAH is its P/B ratio of 1.32. 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 1.70. Over the past year, SAH's P/B has been as high as 1.32 and as low as 0.70, with a median of 0.95.
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. SAH has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.25.
Finally, investors should note that SAH has a P/CF ratio of 5.84. 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. SAH's current P/CF looks attractive when compared to its industry's average P/CF of 6.73. Over the past 52 weeks, SAH's P/CF has been as high as 5.84 and as low as 3, with a median of 4.31.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Sonic Automotive is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SAH feels like a great value stock at the moment.
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Are Investors Undervaluing Sonic Automotive (SAH) Right Now?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
Sonic Automotive (SAH - Free Report) is a stock many investors are watching right now. SAH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Another notable valuation metric for SAH is its P/B ratio of 1.32. 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 1.70. Over the past year, SAH's P/B has been as high as 1.32 and as low as 0.70, with a median of 0.95.
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. SAH has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.25.
Finally, investors should note that SAH has a P/CF ratio of 5.84. 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. SAH's current P/CF looks attractive when compared to its industry's average P/CF of 6.73. Over the past 52 weeks, SAH's P/CF has been as high as 5.84 and as low as 3, with a median of 4.31.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Sonic Automotive is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SAH feels like a great value stock at the moment.