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.
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.
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 stock to keep an eye on is Hanmi Financial (HAFC). HAFC is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 9.54 right now. For comparison, its industry sports an average P/E of 10.78. Over the past 52 weeks, HAFC's Forward P/E has been as high as 11.89 and as low as 7.95, with a median of 9.30.
We should also highlight that HAFC has a P/B ratio of 0.99. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. HAFC's current P/B looks attractive when compared to its industry's average P/B of 1.47. Over the past year, HAFC's P/B has been as high as 1.10 and as low as 0.74, with a median of 0.94.
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. HAFC has a P/S ratio of 2.13. This compares to its industry's average P/S of 2.65.
Finally, investors should note that HAFC has a P/CF ratio of 10.15. 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. HAFC's current P/CF looks attractive when compared to its industry's average P/CF of 12.05. HAFC's P/CF has been as high as 11.16 and as low as 7.18, with a median of 9.60, all within the past year.
These are just a handful of the figures considered in Hanmi Financial's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that HAFC is an impressive value stock right now.
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Hanmi Financial Corporation (HAFC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).