Back to top

Image: Bigstock

Is Foot Locker (FL) a Great Value Stock Right Now?

Read MoreHide Full Article

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 company to watch right now is Foot Locker (FL - Free Report) . FL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 7.47. This compares to its industry's average Forward P/E of 12.06. Over the past year, FL's Forward P/E has been as high as 12.85 and as low as 6.56, with a median of 8.17.

Investors should also note that FL holds a PEG ratio of 0.84. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. FL's PEG compares to its industry's average PEG of 1.25. Over the past 52 weeks, FL's PEG has been as high as 1.72 and as low as 0.66, with a median of 0.84.

Investors should also recognize that FL has a P/B ratio of 1.74. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 3.35. FL's P/B has been as high as 2.90 and as low as 1.48, with a median of 1.83, over the past year.

Finally, our model also underscores that FL has a P/CF ratio of 6.08. 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 8.59. Over the past year, FL's P/CF has been as high as 12.79 and as low as 5.40, with a median of 6.64.

These are only a few of the key metrics included in Foot Locker'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, FL looks like an impressive value stock at the moment.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Foot Locker, Inc. (FL) - free report >>

Published in