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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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Leidos (LDOS - Free Report) . LDOS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 16.29, while its industry has an average P/E of 19.65. Over the past year, LDOS's Forward P/E has been as high as 17.84 and as low as 12.65, with a median of 14.83.
We also note that LDOS holds a PEG ratio of 1.47. 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. LDOS's PEG compares to its industry's average PEG of 1.64. Within the past year, LDOS's PEG has been as high as 2.06 and as low as 1.47, with a median of 1.75.
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. LDOS has a P/S ratio of 1.22. This compares to its industry's average P/S of 1.82.
Finally, we should also recognize that LDOS has a P/CF ratio of 16.19. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. LDOS's current P/CF looks attractive when compared to its industry's average P/CF of 24.80. Within the past 12 months, LDOS's P/CF has been as high as 17.19 and as low as 11.50, with a median of 13.80.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Leidos is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, LDOS feels like a great value stock at the moment.
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Should Value Investors Buy Leidos (LDOS) Stock?
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Leidos (LDOS - Free Report) . LDOS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 16.29, while its industry has an average P/E of 19.65. Over the past year, LDOS's Forward P/E has been as high as 17.84 and as low as 12.65, with a median of 14.83.
We also note that LDOS holds a PEG ratio of 1.47. 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. LDOS's PEG compares to its industry's average PEG of 1.64. Within the past year, LDOS's PEG has been as high as 2.06 and as low as 1.47, with a median of 1.75.
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. LDOS has a P/S ratio of 1.22. This compares to its industry's average P/S of 1.82.
Finally, we should also recognize that LDOS has a P/CF ratio of 16.19. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. LDOS's current P/CF looks attractive when compared to its industry's average P/CF of 24.80. Within the past 12 months, LDOS's P/CF has been as high as 17.19 and as low as 11.50, with a median of 13.80.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Leidos is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, LDOS feels like a great value stock at the moment.