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Is Lions Gate Entertainment (LGF.A) a Great Value Stock Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 value investors might notice is Lions Gate Entertainment (LGF.A - Free Report) . LGF.A is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Another valuation metric that we should highlight is LGF.A's P/B ratio of 0.62. 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 attractive against its industry's average P/B of 1.22. LGF.A's P/B has been as high as 1.46 and as low as 0.60, with a median of 1.06, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. LGF.A has a P/S ratio of 0.48. This compares to its industry's average P/S of 0.97.

These are only a few of the key metrics included in Lions Gate Entertainment's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, LGF.A looks like an impressive value stock at the moment.


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