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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Genesco (GCO). GCO is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value.
Finally, our model also underscores that GCO has a P/CF ratio of 11.89. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. GCO's P/CF compares to its industry's average P/CF of 11.97. Over the past 52 weeks, GCO's P/CF has been as high as 17.26 and as low as 5.49, with a median of 7.39.
These are only a few of the key metrics included in Genesco'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, GCO looks like an impressive value stock at the moment.
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Genesco Inc. (GCO): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).