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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
One company to watch right now is BG Staffing (BGSF - Free Report) . BGSF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Investors should also note that BGSF holds a PEG ratio of 0.61. 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. BGSF's industry has an average PEG of 1.32 right now. Over the last 12 months, BGSF's PEG has been as high as 0.85 and as low as 0.50, with a median of 0.64.
Finally, we should also recognize that BGSF has a P/CF ratio of 8.37. 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 9.59. Over the past year, BGSF's P/CF has been as high as 17.37 and as low as 7.34, with a median of 11.08.
Value investors will likely look at more than just these metrics, but the above data helps show that BG Staffing is likely undervalued currently. And when considering the strength of its earnings outlook, BGSF sticks out at as one of the market's strongest value stocks.