Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company value investors might notice is Pilgrim's Pride (PPC). PPC 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 10.92 right now. For comparison, its industry sports an average P/E of 18.41. Over the past 52 weeks, PPC's Forward P/E has been as high as 19.10 and as low as 10.70, with a median of 14.41.
Another notable valuation metric for PPC is its P/B ratio of 2.85. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 3.05. Over the past year, PPC's P/B has been as high as 3.58 and as low as 2.40, with a median of 3.14.
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. PPC has a P/S ratio of 0.59. This compares to its industry's average P/S of 0.72.
Finally, investors will want to recognize that PPC has a P/CF ratio of 10.41. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. PPC's P/CF compares to its industry's average P/CF of 14.60. Within the past 12 months, PPC's P/CF has been as high as 14.74 and as low as 9.22, with a median of 12.38.
These are only a few of the key metrics included in Pilgrim's Pride'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, PPC looks like an impressive value stock at the moment.