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.
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 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.
UniFirst (UNF - Free Report) is a stock many investors are watching right now. UNF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 23.34 right now. For comparison, its industry sports an average P/E of 30.16. Over the last 12 months, UNF's Forward P/E has been as high as 26.47 and as low as 15.13, with a median of 23.57.
Finally, investors will want to recognize that UNF has a P/CF ratio of 11.97. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. UNF's P/CF compares to its industry's average P/CF of 19.61. Within the past 12 months, UNF's P/CF has been as high as 14.45 and as low as 8.69, with a median of 13.28.
Value investors will likely look at more than just these metrics, but the above data helps show that UniFirst is likely undervalued currently. And when considering the strength of its earnings outlook, UNF sticks out at as one of the market's strongest value stocks.