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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
One company to watch right now is Aegion (AEGN - Free Report) . AEGN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Investors should also recognize that AEGN has a P/B ratio of 1.53. 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 2.16. AEGN's P/B has been as high as 1.67 and as low as 0.99, with a median of 1.28, over 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. AEGN has a P/S ratio of 0.51. This compares to its industry's average P/S of 1.08.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Aegion is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AEGN feels like a great value stock at the moment.