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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 #2 (Buy) and an A for Value.
We also note that HRB holds a PEG ratio of 0.50. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HRB's PEG compares to its industry's average PEG of 1.35. Over the last 12 months, HRB's PEG has been as high as 1.46 and as low as 0.42, with a median of 1.18.
Finally, we should also recognize that HRB has a P/CF ratio of 5.27. 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 9.19. Over the past year, HRB's P/CF has been as high as 10.15 and as low as 4.02, with a median of 8.19.
These are only a few of the key metrics included in H&R Block'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, HRB looks like an impressive value stock at the moment.