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Should Value Investors Buy Powell Industries (POWL) 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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Powell Industries (POWL - Free Report) . POWL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 15.29, while its industry has an average P/E of 25.50. POWL's Forward P/E has been as high as 24.80 and as low as 14.47, with a median of 17.86, all within the past year.
POWL is also sporting a PEG ratio of 1.09. 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. POWL's industry currently sports an average PEG of 2.20. Within the past year, POWL's PEG has been as high as 1.77 and as low as 1.03, with a median of 1.28.
Another valuation metric that we should highlight is POWL's P/B ratio of 4.19. 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. This stock's P/B looks solid versus its industry's average P/B of 4.29. Over the past year, POWL's P/B has been as high as 6.28 and as low as 2.19, with a median of 3.13.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. POWL has a P/S ratio of 1.99. This compares to its industry's average P/S of 3.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Powell Industries is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, POWL feels like a great value stock at the moment.
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Should Value Investors Buy Powell Industries (POWL) Stock?
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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Powell Industries (POWL - Free Report) . POWL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 15.29, while its industry has an average P/E of 25.50. POWL's Forward P/E has been as high as 24.80 and as low as 14.47, with a median of 17.86, all within the past year.
POWL is also sporting a PEG ratio of 1.09. 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. POWL's industry currently sports an average PEG of 2.20. Within the past year, POWL's PEG has been as high as 1.77 and as low as 1.03, with a median of 1.28.
Another valuation metric that we should highlight is POWL's P/B ratio of 4.19. 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. This stock's P/B looks solid versus its industry's average P/B of 4.29. Over the past year, POWL's P/B has been as high as 6.28 and as low as 2.19, with a median of 3.13.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. POWL has a P/S ratio of 1.99. This compares to its industry's average P/S of 3.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Powell Industries is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, POWL feels like a great value stock at the moment.