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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 stock to keep an eye on is Hibbett Sports (HIBB - Free Report) . HIBB is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 9.66. This compares to its industry's average Forward P/E of 13.07. HIBB's Forward P/E has been as high as 13.17 and as low as 6.79, with a median of 10.18, all within the past year.
HIBB is also sporting a PEG ratio of 0.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HIBB's industry currently sports an average PEG of 1.27. HIBB's PEG has been as high as 5.45 and as low as 0.62, with a median of 1.22, all within the past year.
Finally, investors should note that HIBB has a P/CF ratio of 7.64. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. HIBB's P/CF compares to its industry's average P/CF of 19.80. Over the past year, HIBB's P/CF has been as high as 8.49 and as low as 4.53, with a median of 5.99.
Value investors will likely look at more than just these metrics, but the above data helps show that Hibbett Sports is likely undervalued currently. And when considering the strength of its earnings outlook, HIBB sticks out at as one of the market's strongest value stocks.