Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Mazda Motor (MZDAY). MZDAY is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A.
We should also highlight that MZDAY has a P/B ratio of 0.39. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. MZDAY's current P/B looks attractive when compared to its industry's average P/B of 1.01. MZDAY's P/B has been as high as 0.43 and as low as 0.28, with a median of 0.35, over the past year.
Finally, investors will want to recognize that MZDAY has a P/CF ratio of 5.04. 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. MZDAY's current P/CF looks attractive when compared to its industry's average P/CF of 5.09. Over the past 52 weeks, MZDAY's P/CF has been as high as 5.41 and as low as 2.10, with a median of 2.55.
These are just a handful of the figures considered in Mazda Motor'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 MZDAY is an impressive value stock right now.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
