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Is Heidrick & Struggles (HSII) Stock Undervalued Right Now?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Heidrick & Struggles (HSII - Free Report) . HSII is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 13.74 right now. For comparison, its industry sports an average P/E of 14. Over the last 12 months, HSII's Forward P/E has been as high as 45.88 and as low as 7.81, with a median of 12.08.

Investors should also note that HSII holds a PEG ratio of 1.37. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HSII's PEG compares to its industry's average PEG of 2.01. HSII's PEG has been as high as 4.59 and as low as 0.78, with a median of 1.21, all within the past year.

Another notable valuation metric for HSII is its P/B ratio of 1.49. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.74. Over the past 12 months, HSII's P/B has been as high as 2.12 and as low as 1.13, with a median of 1.48.

These are just a handful of the figures considered in Heidrick & Struggles'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 HSII is an impressive value stock right now.


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