Is Sierra Bancorp (BSRR) 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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Sierra Bancorp (BSRR). BSRR is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 9.96. This compares to its industry's average Forward P/E of 12.91. Over the past year, BSRR's Forward P/E has been as high as 13.93 and as low as 6.09, with a median of 11.40.
We also note that BSRR holds a PEG ratio of 1.52. 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. BSRR's PEG compares to its industry's average PEG of 1.95. Over the last 12 months, BSRR's PEG has been as high as 1.52 and as low as 1.45, with a median of 1.49.
We should also highlight that BSRR has a P/B ratio of 0.82. 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 attractive against its industry's average P/B of 1.16. Within the past 52 weeks, BSRR's P/B has been as high as 1.52 and as low as 0.65, with a median of 0.97.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. BSRR has a P/S ratio of 2.09. This compares to its industry's average P/S of 2.1.
Finally, we should also recognize that BSRR has a P/CF ratio of 6.01. 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. This stock's P/CF looks attractive against its industry's average P/CF of 13.83. BSRR's P/CF has been as high as 10.08 and as low as 4.31, with a median of 6.80, all within the past year.
These are only a few of the key metrics included in Sierra Bancorp'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, BSRR looks like an impressive 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.