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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Meet Group (MEET - Free Report) . MEET is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
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. MEET has a P/S ratio of 1.65. This compares to its industry's average P/S of 3.78.
Finally, investors will want to recognize that MEET has a P/CF ratio of 13.15. 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. This stock's P/CF looks attractive against its industry's average P/CF of 49.22. MEET's P/CF has been as high as 31.11 and as low as -7.72, with a median of 12.49, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Meet Group is likely undervalued currently. And when considering the strength of its earnings outlook, MEET sticks out at as one of the market's strongest value stocks.