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 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 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 a P/E ratio of 9.54, which compares to its industry's average of 10.15. Over the last 12 months, 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. 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. This company's current P/B looks solid when compared to its industry's average P/B of 1.37. Over the past 12 months, 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. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. HAFC has a P/S ratio of 2.04. This compares to its industry's average P/S of 2.47.
Finally, we should also recognize 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 P/CF compares to its industry's average P/CF of 11.40. Over the past year, HAFC's P/CF has been as high as 11.16 and as low as 7.18, with a median of 9.60.
These are only a few of the key metrics included in Hanmi Financial'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, HAFC looks like an impressive value stock at the moment.
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Hanmi Financial Corporation (HAFC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).