While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Park Hotels & Resorts (PK) is a stock many investors are watching right now. PK is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 5.89. This compares to its industry's average Forward P/E of 17.05. Over the last 12 months, PK's Forward P/E has been as high as 7.11 and as low as 4.38, with a median of 5.77.
Investors will also notice that PK has a PEG ratio of 1.37. 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. PK's PEG compares to its industry's average PEG of 1.53. PK's PEG has been as high as 6.29 and as low as 0.61, with a median of 1.28, all within the past year.
We should also highlight that PK has a P/B ratio of 0.71. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. PK's current P/B looks attractive when compared to its industry's average P/B of 1.99. Within the past 52 weeks, PK's P/B has been as high as 0.88 and as low as 0.52, with a median of 0.70.
Finally, investors should note that PK has a P/CF ratio of 6.18. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.83. Over the past 52 weeks, PK's P/CF has been as high as 6.25 and as low as 4.43, with a median of 5.21.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Park Hotels & Resorts is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PK feels like a great value stock at the moment.
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Park Hotels & Resorts Inc. (PK): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).