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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Honda Motor (HMC). HMC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 7.55 right now. For comparison, its industry sports an average P/E of 7.81. Over the past 52 weeks, HMC's Forward P/E has been as high as 10.71 and as low as 6.35, with a median of 8.89.
Investors should also recognize that HMC has a P/B ratio of 0.65. 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 stock's P/B looks solid versus its industry's average P/B of 0.90. HMC's P/B has been as high as 0.88 and as low as 0.61, with a median of 0.80, over the past year.
These are only a few of the key metrics included in Honda Motor'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, HMC looks like an impressive value stock at the moment.