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.
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 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 stock to keep an eye on is Stagwell Inc. (STGW). STGW is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 5.71. This compares to its industry's average Forward P/E of 7.12. Over the past year, STGW's Forward P/E has been as high as 9.95 and as low as 4.61, with a median of 6.88.
Another notable valuation metric for STGW is its P/B ratio of 1.71. 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. This company's current P/B looks solid when compared to its industry's average P/B of 4.77. Within the past 52 weeks, STGW's P/B has been as high as 2.87 and as low as 1.42, with a median of 2.06.
These are only a few of the key metrics included in Stagwell Inc.'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, STGW looks like an impressive value stock at the moment.
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Stagwell Inc. (STGW): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).