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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 company to watch right now is Associated BancCorp (ASB). ASB is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 9.42 right now. For comparison, its industry sports an average P/E of 9.55. Over the past year, ASB's Forward P/E has been as high as 14.84 and as low as 8.70, with a median of 9.96.
Investors should also recognize that ASB has a P/B ratio of 0.90. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.23. Over the past 12 months, ASB's P/B has been as high as 1.01 and as low as 0.70, with a median of 0.87.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ASB has a P/S ratio of 2.31. This compares to its industry's average P/S of 2.57.
Finally, investors will want to recognize that ASB has a P/CF ratio of 7.66. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 14.41. Within the past 12 months, ASB's P/CF has been as high as 8.54 and as low as 6.05, with a median of 7.33.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Associated BancCorp is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ASB feels like a great value stock at the moment.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
