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 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 stock to keep an eye on is H&R Block (HRB - Free Report) . HRB is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 9.38 right now. For comparison, its industry sports an average P/E of 16.42. Over the last 12 months, HRB's Forward P/E has been as high as 14.59 and as low as 9.27, with a median of 12.26.
We also note that HRB holds a PEG ratio of 0.94. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. HRB's industry has an average PEG of 1.40 right now. HRB's PEG has been as high as 1.46 and as low as 0.93, with a median of 1.23, all within the past year.
Finally, our model also underscores that HRB has a P/CF ratio of 8.09. 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. HRB's current P/CF looks attractive when compared to its industry's average P/CF of 9.19. HRB's P/CF has been as high as 10.15 and as low as 5.62, with a median of 8.23, all within the past year.
These are just a handful of the figures considered in H&R Block'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 HRB is an impressive value stock right now.