Back to top

Image: Bigstock

Is Resources Connection (RGP) a Great Value Stock Right Now?

Read MoreHide Full Article

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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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 Resources Connection (RGP - Free Report) . RGP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 10.26, while its industry has an average P/E of 12.89. Over the last 12 months, RGP's Forward P/E has been as high as 10.26 and as low as 9.70, with a median of 9.70.

Investors should also recognize that RGP has a P/B ratio of 1.09. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.40. Over the past 12 months, RGP's P/B has been as high as 2.02 and as low as 0.95, with a median of 1.76.

Finally, we should also recognize that RGP has a P/CF ratio of 7.60. 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. This stock's P/CF looks attractive against its industry's average P/CF of 9.38. Within the past 12 months, RGP's P/CF has been as high as 15.67 and as low as 6.66, with a median of 12.66.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Resources Connection is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, RGP feels like a great value stock at the moment.


In-Depth Zacks Research for the Tickers Above


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


Resources Connection, Inc. (RGP) - free report >>

Published in