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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 to watch right now is Maximus (MMS – Free Report) . MMS is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 12.39, which compares to its industry’s average of 13.05. Over the past 52 weeks, MMS’s Forward P/E has been as high as 15.98 and as low as 11.84, with a median of 14.89.
We should also highlight that MMS has a P/B ratio of 2.38. 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 company’s current P/B looks solid when compared to its industry’s average P/B of 2.58. MMS’s P/B has been as high as 3.11 and as low as 2.28, with a median of 2.93, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock’s price with the company’s revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. MMS has a P/S ratio of 0.84. This compares to its industry’s average P/S of 0.98.
Finally, we should also recognize that MMS has a P/CF ratio of 10.22. This figure highlights a company’s operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock’s P/CF looks attractive against its industry’s average P/CF of 11.50. MMS’s P/CF has been as high as 16.55 and as low as 9.78, with a median of 13.19, all within the past year.
These are just a handful of the figures considered in Maximus’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 MMS is an impressive value stock right now.
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