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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Newell Brands (NWL - Free Report) . NWL is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 12.02 right now. For comparison, its industry sports an average P/E of 20.89. Over the past 52 weeks, NWL's Forward P/E has been as high as 15.26 and as low as 8.64, with a median of 10.52.
NWL is also sporting a PEG ratio of 2. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NWL's industry currently sports an average PEG of 2.71. Within the past year, NWL's PEG has been as high as 3.14 and as low as 1.44, with a median of 2.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. NWL has a P/S ratio of 0.92. This compares to its industry's average P/S of 1.43.
Finally, we should also recognize that NWL has a P/CF ratio of 4.64. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 11.32. Within the past 12 months, NWL's P/CF has been as high as 5.06 and as low as 1.77, with a median of 2.44.
These are just a handful of the figures considered in Newell Brands's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that NWL is an impressive value stock right now.