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, 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is SSAB (SSAAY). SSAAY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 8.50 right now. For comparison, its industry sports an average P/E of 9.14. SSAAY's Forward P/E has been as high as 11.97 and as low as 2.63, with a median of 9.23, all within the past year.
Another valuation metric that we should highlight is SSAAY's P/B ratio of 1.19. 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. SSAAY's current P/B looks attractive when compared to its industry's average P/B of 1.71. Over the past 12 months, SSAAY's P/B has been as high as 1.21 and as low as 0.57, with a median of 1.01.
Finally, investors should note that SSAAY has a P/CF ratio of 4.64. 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. SSAAY's current P/CF looks attractive when compared to its industry's average P/CF of 10.24. Within the past 12 months, SSAAY's P/CF has been as high as 4.64 and as low as 1.91, with a median of 3.10.
These figures are just a handful of the metrics value investors tend to look at, but they help show that SSAB is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SSAAY 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.
