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Are Investors Undervaluing Blue Bird (BLBD) 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Blue Bird (BLBD - Free Report) is a stock many investors are watching right now. BLBD is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 13.61, which compares to its industry's average of 37.14. Over the last 12 months, BLBD's Forward P/E has been as high as 24.06 and as low as 11.73, with a median of 15.25.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. BLBD has a P/S ratio of 1.06. This compares to its industry's average P/S of 1.12.

Finally, we should also recognize that BLBD has a P/CF ratio of 13.44. 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. BLBD's current P/CF looks attractive when compared to its industry's average P/CF of 21.87. Over the past 52 weeks, BLBD's P/CF has been as high as 22.25 and as low as 10.11, with a median of 14.37.

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


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