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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company to watch right now is Cardtronics (CATM - Free Report) . CATM is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 14.71, while its industry has an average P/E of 26.17. Over the past 52 weeks, CATM's Forward P/E has been as high as 18.82 and as low as 11.29, with a median of 13.88.
Another valuation metric that we should highlight is CATM's P/B ratio of 4.74. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. CATM's current P/B looks attractive when compared to its industry's average P/B of 12.04. Over the past year, CATM's P/B has been as high as 4.74 and as low as 2.67, with a median of 3.72.
Finally, investors should note that CATM has a P/CF ratio of 7.42. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 25.40. Over the past year, CATM's P/CF has been as high as 8.49 and as low as 5.08, with a median of 6.72.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Cardtronics is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CATM feels like a great value stock at the moment.