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.
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 company value investors might notice is Phibro Animal Health (PAHC). PAHC is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 15.37. This compares to its industry's average Forward P/E of 16.10. Over the last 12 months, PAHC's Forward P/E has been as high as 16.56 and as low as 7.98, with a median of 12.28.
Investors will also notice that PAHC has a PEG ratio of 1.20. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PAHC's industry currently sports an average PEG of 1.92. Over the past 52 weeks, PAHC's PEG has been as high as 1.74 and as low as 0.30, with a median of 0.50.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PAHC has a P/S ratio of 0.92. This compares to its industry's average P/S of 1.66.
These are only a few of the key metrics included in Phibro Animal Health'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, PAHC looks like an impressive value stock at the moment.
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Phibro Animal Health Corporation (PAHC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).