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Is CRA International (CRAI) Stock Undervalued 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.

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.

CRA International (CRAI - Free Report) is a stock many investors are watching right now. CRAI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 14.83. This compares to its industry's average Forward P/E of 22.31. CRAI's Forward P/E has been as high as 24.61 and as low as 12.40, with a median of 16.93, all within the past year.

CRAI is also sporting a PEG ratio of 1.14. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CRAI's industry has an average PEG of 1.96 right now. CRAI's PEG has been as high as 1.19 and as low as 0.78, with a median of 0.85, 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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CRAI has a P/S ratio of 0.78. This compares to its industry's average P/S of 1.47.

Finally, investors will want to recognize that CRAI has a P/CF ratio of 9.54. 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. CRAI's current P/CF looks attractive when compared to its industry's average P/CF of 14.74. CRAI's P/CF has been as high as 23.05 and as low as 8.32, with a median of 12.51, all within the past year.

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


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