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Is Brighthouse Financial (BHF) a Great Value Stock Right Now?

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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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 stock to keep an eye on is Brighthouse Financial (BHF - Free Report) . BHF is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 4.18. This compares to its industry's average Forward P/E of 9.41. Over the past year, BHF's Forward P/E has been as high as 8 and as low as 3.54, with a median of 4.08.

Investors should also note that BHF holds a PEG ratio of 0.37. 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. BHF's PEG compares to its industry's average PEG of 0.90. Over the last 12 months, BHF's PEG has been as high as 0.74 and as low as 0.30, with a median of 0.37.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. BHF has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.68.

Value investors will likely look at more than just these metrics, but the above data helps show that Brighthouse Financial is likely undervalued currently. And when considering the strength of its earnings outlook, BHF sticks out at as one of the market's strongest value stocks.


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