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Looking for a Top Value Stock? 3 Reasons Why Silvercrest Asset Management (SAMG) is an Excellent Choice - Tale of the Tape

Many investors like to look for value in stocks, but this can be very tough to define. There is great debate regarding which metrics are the best to focus on in this regard, and which are not really quality indicators of future performance. Fortunately, with our new style score system we have identified the key statistics to pay close attention to and thus which stocks might be the best for value investors in the near term.

This method discovered several great candidates for value-oriented investors, but today let's focus on Silvercrest Asset Management Group Inc. ( SAMG ) as this stock is looking especially impressive right now. And while there are numerous reasons why this is the case, we have highlighted three of the most vital reasons for SAMG's status as a solid value stock below:

Price to Forward Sales for Silvercrest Asset Management

One of the most underrated ratios for value investors is the price/forward sales metric. This ratio shows investors how much they are paying for each dollar of revenues generated. In other words, a lower number is better here while a price to sales ratio of 1 means that you are paying one dollar for each dollar in sales.

With a P/S ratio of 1.66, SAMG investors are paying $1.66 in stock price for each dollar of revenue generated by the company. Compare this to the industry average of 2.37, and it is safe to say that SAMG is undervalued compared to many of its peers on this important metric.

Price/Cash Flow for Silvercrest Asset Management Stock

An often overlooked ratio that can still be a great indicator of value is the price/cash flow metric. This reading is preferred by some since it avoids amortization and depreciation concerns and can give a more accurate picture of the financial health in a business.

The P/CF ratio for SAMG comes in at 8.98, and since investors are generally looking for a reading under 20 here, this is pretty good news. Meanwhile, we should also point out that the industry average for this metric is 10.68, so Silvercrest Asset Management has its peers beat in this regard too.

SAMG Earnings Estimate Revisions Moving in the Right Direction

The solid value ratios outlined in the preceding paragraphs might be enough for some investors, but we should also note that the earnings estimate revisions have been trending in a positive direction as well. Analysts who follow SAMG stock have been raising their estimates for the company lately, meaning that the EPS picture is looking a bit more favorably for Silvercrest Asset Management now.

Over the past 30 days 1 earnings estimate has gone higher compared to 0 lower for the full year. These revisions have helped to boost the consensus estimate as 30 days ago SAMG was expected to post earnings of 94 cents per share for the full year though today it looks to have EPS of 98 cents for the full year.

Bottom Line

For the reasons detailed above, investors shouldn't be surprised to read that we have SAMG as a stock with a Value Score of 'A' and a Zacks Rank #1 (Strong Buy). So if you are a value investor, definitely keep SAMG on your short list as this looks be a stock that is very well-positioned for gains in the near term.

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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.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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