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.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is Orix Corp Ads (IX). IX is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.59. This compares to its industry's average Forward P/E of 17.00. Over the past 52 weeks, IX's Forward P/E has been as high as 10.60 and as low as 7.34, with a median of 9.04.
We also note that IX holds a PEG ratio of 0.99. 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. IX's industry currently sports an average PEG of 1.08. Within the past year, IX's PEG has been as high as 1.10 and as low as 0.73, with a median of 0.94.
We should also highlight that IX has a P/B ratio of 1.06. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 3.01. IX's P/B has been as high as 1.11 and as low as 0.76, with a median of 0.89, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. IX has a P/S ratio of 1.94. This compares to its industry's average P/S of 2.42.
These are just a handful of the figures considered in Orix Corp Ads'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 IX is an impressive value stock right now.
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Orix Corp Ads (IX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).