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Should Value Investors Buy Brother Industries (BRTHY) Stock?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Brother Industries (BRTHY - Free Report) . BRTHY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 9.29. This compares to its industry's average Forward P/E of 12.87. BRTHY's Forward P/E has been as high as 12.34 and as low as 9.29, with a median of 10.84, all within the past year.

Finally, our model also underscores that BRTHY has a P/CF ratio of 7.52. 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. BRTHY's P/CF compares to its industry's average P/CF of 9.30. Within the past 12 months, BRTHY's P/CF has been as high as 8.96 and as low as 6.81, with a median of 8.19.

These are only a few of the key metrics included in Brother Industries's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, BRTHY looks like an impressive value stock at the moment.


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