The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 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.
One company value investors might notice is Perdoceo Education (PRDO). PRDO is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
Another valuation metric that we should highlight is PRDO's P/B ratio of 2.3. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. PRDO's current P/B looks attractive when compared to its industry's average P/B of 3.24. Within the past 52 weeks, PRDO's P/B has been as high as 2.35 and as low as 1.45, with a median of 1.90.
Finally, we should also recognize that PRDO has a P/CF ratio of 12.58. 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. PRDO's current P/CF looks attractive when compared to its industry's average P/CF of 19.64. PRDO's P/CF has been as high as 13.01 and as low as 9.25, with a median of 11.47, all within the past year.
Another great Schools stock you could consider is TAL Education Group (TAL), which is a Zacks Rank of #1 (Strong Buy) stock with a Value Score of A.
TAL Education Group is currently trading with a Forward P/E ratio of 21.65 while its PEG ratio sits at 0.47. Both of the company's metrics compare favorably to its industry's average P/E of 11.04 and average PEG ratio of 0.78.
TAL's Forward P/E has been as high as 43.34 and as low as 16.46, with a median of 23.04. During the same time period, its PEG ratio has been as high as 0.52, as low as 0.44, with a median of 0.47.
Additionally, TAL Education Group has a P/B ratio of 1.90 while its industry's price-to-book ratio sits at 3.24. For TAL, this valuation metric has been as high as 2.38, as low as 1.22, with a median of 1.78 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Perdoceo Education and TAL Education Group are likely undervalued currently. And when considering the strength of its earnings outlook, PRDO and TAL sticks out as one of the market's strongest value stocks.
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Perdoceo Education Corporation (PRDO): Free Stock Analysis Report
TAL Education Group (TAL): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).