Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. 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 Helix Energy Solutions Group (HLX). HLX 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 20.3 right now. For comparison, its industry sports an average P/E of 22.36. HLX's Forward P/E has been as high as 33.05 and as low as 7.83, with a median of 13.36, all within the past year.
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 preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. HLX has a P/S ratio of 1.08. This compares to its industry's average P/S of 1.39.
Finally, we should also recognize that HLX has a P/CF ratio of 4.91. 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. HLX's P/CF compares to its industry's average P/CF of 11.22. HLX's P/CF has been as high as 9.68 and as low as 4.11, with a median of 6.20, all within the past year.
These are just a handful of the figures considered in Helix Energy Solutions Group'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 HLX is an impressive value stock right now.
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Helix Energy Solutions Group, Inc. (HLX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).