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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company value investors might notice is H&E Equipment (HEES - Free Report) . HEES is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
We should also highlight that HEES has a P/B ratio of 3.72. The P/B ratio is used to compare a stock's market value with 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 4.02. Within the past 52 weeks, HEES's P/B has been as high as 5.88 and as low as 2.74, with a median of 3.61.
Finally, we should also recognize that HEES has a P/CF ratio of 3. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. HEES's current P/CF looks attractive when compared to its industry's average P/CF of 6.84. HEES's P/CF has been as high as 4.04 and as low as 1.83, with a median of 2.90, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that H&E Equipment is likely undervalued currently. And when considering the strength of its earnings outlook, HEES sticks out at as one of the market's strongest value stocks.