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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is Weight Watchers International (WW). WW is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 14.90, while its industry has an average P/E of 15.11. Over the last 12 months, WW's Forward P/E has been as high as 22.70 and as low as 5.58, with a median of 13.73.
WW is also sporting 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. WW's PEG compares to its industry's average PEG of 1.22. WW's PEG has been as high as 1.36 and as low as 0.24, with a median of 0.88, all within the past year.
These are only a few of the key metrics included in Weight Watchers International'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, WW looks like an impressive value stock at the moment.
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