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Should Value Investors Buy These Construction Stocks?
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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 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 company value investors might notice is Taylor Morrison Home (TMHC - Free Report) . TMHC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 3.41. This compares to its industry's average Forward P/E of 4.92. Over the last 12 months, TMHC's Forward P/E has been as high as 6.71 and as low as 3.21, with a median of 4.62.
Investors should also recognize that TMHC has a P/B ratio of 0.89. 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 solid versus its industry's average P/B of 1.18. Within the past 52 weeks, TMHC's P/B has been as high as 1.16 and as low as 0.78, with a median of 0.96.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. TMHC has a P/S ratio of 0.46. This compares to its industry's average P/S of 0.6.
Investors could also keep in mind Tri Pointe Homes (TPH - Free Report) , an Building Products - Home Builders stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Furthermore, Tri Pointe Homes holds a P/B ratio of 0.95 and its industry's price-to-book ratio is 1.18. TPH's P/B has been as high as 1.36, as low as 0.93, with a median of 1.15 over the past 12 months.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Taylor Morrison Home and Tri Pointe Homes are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TMHC and TPH feels like a great value stock at the moment.
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Should Value Investors Buy These Construction Stocks?
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 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 company value investors might notice is Taylor Morrison Home (TMHC - Free Report) . TMHC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 3.41. This compares to its industry's average Forward P/E of 4.92. Over the last 12 months, TMHC's Forward P/E has been as high as 6.71 and as low as 3.21, with a median of 4.62.
Investors should also recognize that TMHC has a P/B ratio of 0.89. 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 solid versus its industry's average P/B of 1.18. Within the past 52 weeks, TMHC's P/B has been as high as 1.16 and as low as 0.78, with a median of 0.96.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. TMHC has a P/S ratio of 0.46. This compares to its industry's average P/S of 0.6.
Investors could also keep in mind Tri Pointe Homes (TPH - Free Report) , an Building Products - Home Builders stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Furthermore, Tri Pointe Homes holds a P/B ratio of 0.95 and its industry's price-to-book ratio is 1.18. TPH's P/B has been as high as 1.36, as low as 0.93, with a median of 1.15 over the past 12 months.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Taylor Morrison Home and Tri Pointe Homes are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TMHC and TPH feels like a great value stock at the moment.