Is Patrick Industries (PATK) a Great Value Stock Right Now?
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company to watch right now is Patrick Industries (PATK). PATK is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with P/E ratio of 11.88 right now. For comparison, its industry sports an average P/E of 18.30. Over the past year, PATK's Forward P/E has been as high as 24.07 and as low as 4.43, with a median of 12.38.
We also note that PATK holds a PEG ratio of 1.25. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. PATK's industry currently sports an average PEG of 1.59. Over the last 12 months, PATK's PEG has been as high as 10.81 and as low as 0.64, with a median of 1.71.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PATK has a P/S ratio of 0.58. This compares to its industry's average P/S of 1.32.
Finally, investors will want to recognize that PATK has a P/CF ratio of 8.80. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. PATK's P/CF compares to its industry's average P/CF of 16.63. Over the past year, PATK's P/CF has been as high as 11.61 and as low as 2.83, with a median of 7.51.
These are just a handful of the figures considered in Patrick Industries's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that PATK is an impressive value stock right now.
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