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Should Value Investors Buy BG Staffing (BGSF) Stock?

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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, 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company value investors might notice is BG Staffing (BGSF - Free Report) . BGSF is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 8.78 right now. For comparison, its industry sports an average P/E of 14.24. Over the last 12 months, BGSF's Forward P/E has been as high as 16.69 and as low as 4.33, with a median of 12.97.

Another notable valuation metric for BGSF is its P/B ratio of 1.57. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. BGSF's current P/B looks attractive when compared to its industry's average P/B of 1.74. BGSF's P/B has been as high as 3.36 and as low as 0.94, with a median of 2.57, over the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. BGSF has a P/S ratio of 0.35. This compares to its industry's average P/S of 0.38.

These are just a handful of the figures considered in BG Staffing'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 BGSF is an impressive value stock right now.


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