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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Hertz . HTZ is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 8.89 right now. For comparison, its industry sports an average P/E of 17.42. Over the past year, HTZ's Forward P/E has been as high as 270.57 and as low as -33.27, with a median of 19.92.
Investors should also recognize that HTZ has a P/B ratio of 1.84. 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 company's current P/B looks solid when compared to its industry's average P/B of 3.63. HTZ's P/B has been as high as 2.17 and as low as 0.89, with a median of 1.32, over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Hertz is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, HTZ feels like a great value stock at the moment.