Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
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.
One company value investors might notice is Ingles (IMKTA - Free Report) . IMKTA is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 9.49, which compares to its industry's average of 21.08. Over the last 12 months, IMKTA's Forward P/E has been as high as 12.24 and as low as 7.79, with a median of 9.07.
Investors should also recognize that IMKTA has a P/B ratio of 1.26. 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. This stock's P/B looks attractive against its industry's average P/B of 3.56. IMKTA's P/B has been as high as 1.26 and as low as 0.84, with a median of 1, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. IMKTA has a P/S ratio of 0.2. This compares to its industry's average P/S of 0.31.
Finally, our model also underscores that IMKTA has a P/CF ratio of 4.15. 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. IMKTA's P/CF compares to its industry's average P/CF of 13.59. Over the past year, IMKTA's P/CF has been as high as 4.15 and as low as 2.50, with a median of 3.17.
These are only a few of the key metrics included in Ingles's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, IMKTA looks like an impressive value stock at the moment.