Is Hanmi Financial (HAFC) a Great Value Stock Right Now?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 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.
Hanmi Financial (HAFC) is a stock many investors are watching right now. HAFC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 9.31, which compares to its industry's average of 12.77. Over the past year, HAFC's Forward P/E has been as high as 17.28 and as low as 5.04, with a median of 10.61.
We should also highlight that HAFC has a P/B ratio of 0.48. 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 attractive against its industry's average P/B of 1.16. HAFC's P/B has been as high as 1.12 and as low as 0.43, with a median of 0.58, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. HAFC has a P/S ratio of 0.93. This compares to its industry's average P/S of 2.2.
Finally, our model also underscores that HAFC has a P/CF ratio of 7.07. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. HAFC's P/CF compares to its industry's average P/CF of 13.83. Within the past 12 months, HAFC's P/CF has been as high as 14.63 and as low as 6.01, with a median of 10.21.
Value investors will likely look at more than just these metrics, but the above data helps show that Hanmi Financial is likely undervalued currently. And when considering the strength of its earnings outlook, HAFC sticks out at as one of the market's strongest value stocks.
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