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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is LabCorp (LH - Free Report) . LH is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.64. This compares to its industry's average Forward P/E of 17.61. LH's Forward P/E has been as high as 18.15 and as low as 8.57, with a median of 14.28, all within the past year.
Investors should also note that LH holds a PEG ratio of 1.05. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. LH's industry has an average PEG of 2.46 right now. Over the last 12 months, LH's PEG has been as high as 3.50 and as low as 1.05, with a median of 1.74.
We should also highlight that LH has a P/B ratio of 2.35. 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. This stock's P/B looks attractive against its industry's average P/B of 4.40. Over the past 12 months, LH's P/B has been as high as 2.67 and as low as 1.34, with a median of 2.31.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. LH has a P/S ratio of 1.57. This compares to its industry's average P/S of 3.09.
Finally, investors should note that LH has a P/CF ratio of 11.91. 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. LH's P/CF compares to its industry's average P/CF of 35.19. Within the past 12 months, LH's P/CF has been as high as 18.71 and as low as 6.41, with a median of 12.86.
These are just a handful of the figures considered in LabCorp'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 LH is an impressive value stock right now.
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Is LabCorp (LH) Stock Undervalued Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is LabCorp (LH - Free Report) . LH is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.64. This compares to its industry's average Forward P/E of 17.61. LH's Forward P/E has been as high as 18.15 and as low as 8.57, with a median of 14.28, all within the past year.
Investors should also note that LH holds a PEG ratio of 1.05. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. LH's industry has an average PEG of 2.46 right now. Over the last 12 months, LH's PEG has been as high as 3.50 and as low as 1.05, with a median of 1.74.
We should also highlight that LH has a P/B ratio of 2.35. 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. This stock's P/B looks attractive against its industry's average P/B of 4.40. Over the past 12 months, LH's P/B has been as high as 2.67 and as low as 1.34, with a median of 2.31.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. LH has a P/S ratio of 1.57. This compares to its industry's average P/S of 3.09.
Finally, investors should note that LH has a P/CF ratio of 11.91. 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. LH's P/CF compares to its industry's average P/CF of 35.19. Within the past 12 months, LH's P/CF has been as high as 18.71 and as low as 6.41, with a median of 12.86.
These are just a handful of the figures considered in LabCorp'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 LH is an impressive value stock right now.