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Are Investors Undervaluing Rush Enterprises (RUSHA) Right Now?

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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.

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.

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.

Rush Enterprises (RUSHA - Free Report) is a stock many investors are watching right now. RUSHA is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Investors should also recognize that RUSHA has a P/B ratio of 2.02. The P/B ratio is used to compare a stock's market value with 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 2.33. Within the past 52 weeks, RUSHA's P/B has been as high as 2.20 and as low as 1.46, with a median of 1.87.

Finally, investors should note that RUSHA has a P/CF ratio of 7.83. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.53. Over the past year, RUSHA's P/CF has been as high as 8.27 and as low as 5.01, with a median of 6.67.

Value investors will likely look at more than just these metrics, but the above data helps show that Rush Enterprises is likely undervalued currently. And when considering the strength of its earnings outlook, RUSHA sticks out at as one of the market's strongest value stocks.


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