Is Stewart Information Services (STC) 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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Stewart Information Services (STC) is a stock many investors are watching right now. STC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 11.02 right now. For comparison, its industry sports an average P/E of 22.56. Over the last 12 months, STC's Forward P/E has been as high as 16.57 and as low as 9.65, with a median of 14.69.
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. STC has a P/S ratio of 0.5. This compares to its industry's average P/S of 0.82.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Stewart Information Services is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, STC 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.