Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?

One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put Imperial Brands PLC (IMBBY Quick QuoteIMBBY - Free Report) stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:

PE Ratio

A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.

On this front, Imperial Brandshas a trailing twelve months PE ratio of 6.76, as you can see in the chart below:

This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 19.92. If we focus on the long-term PE trend, Imperial Brands’ current PE level puts it below its midpoint over the past five years, with the number having fallen rapidly over the past few months.

This decrease could be due to the fact that the stock’s price has been on a downtrend while earnings have risen consistently over the past few months. Both of these trends have had a deflating effect on the PE ratio. These trends indicate that the stock might be trading at a good entry point.

Further, the stock’s PE also compares favorably with the Zacks classified Consumer Staples sector’s trailing twelve months PE ratio, which stands at 23.05. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.

We should also point out that Imperial Brands has a forward PE ratio (price relative to this year’s earnings) of just 13.18.   While this indicates the number is expected to rise, the company would still be relatively undervalued to its peers as well as the broader market.

P/S Ratio

Another key metric to note is the Price/Sales ratio. This approach compares a given stock’s price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.

Right now, Imperial Brands has a P/S ratio of about 1.26. This is quite lower than the S&P 500 average, which comes in at 2.98 right now. Also, as we can see in the chart below, this is below the highs for this stock in particular over the past few years.

If anything, this suggests some level of undervalued trading—at least compared to historical norms.

Broad Value Outlook

In aggregate, Imperial Brands currently has a Zacks Value Style Score of ‘B’, putting it into the top 40% of all stocks we cover from this look. This makes Imperial Brands a solid choice for value investors, and some of its other key metrics make this pretty clear too.

For example, the PEG ratio for Imperial Brands is just 1.49, a level that is lower than the industry average of 2.06. The PEG ratio is a modified PE ratio that takes into account the stock’s earnings growth rate. Clearly, IMBBY is a solid choice on the value front from multiple angles.

What About the Stock Overall?

Though Imperial Brands might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘C’ and a Momentum score of ‘F’. This gives IMBBY a Zacks VGM score—or its overarching fundamental grade—of ‘C’. (You can read more about the Zacks Style Scores here >>)

Meanwhile, the company’s consensus estimate has been trending down with the estimate for 2016 decreasing from $3.50 to $3.36 and the estimate for 2017 decreasing from $3.69 to $3.56 over the past two months. You can see the recent price action for the stock in the chart below: