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Zacks Value Trader Highlights: Applied Optoelectronics, First American, ManpowerGroup and LPL Financial
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For Immediate Release
Chicago, IL –Aug 04, 2017 – Zacks Value Trader is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here: (Please use the Soundcloud link from this URL for the PR. Thanks: https://www.zacks.com/stock/news/270479/what-is-the-most-powerful-combination-in-value-investing)
What’s the Most Powerful Combination in Value Investing
Welcome to Episode #53 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio service, shares some of her top value investing tips and stock picks.
It’s the middle of earnings season and many are complaining about the valuation of the stock markets (again).
Several of the major indexes continue to hit new all-time highs which has some investors fretting. But there are still value stocks out there despite stocks moving higher every month.
The Key for Value Investors
Most value investors look to one key metric to start their value stock search: The P/E ratio. Remember that the P/E is price divided by earnings.
During earnings season, we’re getting new information about the “E”, or earnings, in the P/E. For some companies, the “E” will dramatically rise.
If that company’s stock is also rising, it may remain a value stock because the “E” is rising.
For value investors, a rising “E” is critical.
Why Rising Earnings Matter for Value Investors
An example of the importance of the rising “E” can be found with Applied Optoelectronics (NASDAQ:(AAOI - Free Report) – Free Report). Tracey has covered it on prior podcasts because it was a value stock that was up over 100% in 2017.
How could its valuation still be attractive with that kind of stock move?
Ninety days ago, analysts believed Applied Opto would make just $3.76 a share this year. But the estimate has been slowly rising the last 3 months and now sits at $4.95.
Because of rising earnings estimates, Applied Opto has a forward P/E of 19.7. That’s not much higher than the average of the S&P 500.
It would have a P/E of about 25 if the “E” wasn’t exploding to the upside and had remained around $3.76.
The Most Powerful Combination
Value investors obviously want solid value fundamentals when buying a stock. But if they can also get rising earnings estimates at the same time, then something truly special may be going on there.
Tracey did a screen for stocks with P/Es under 20, a P/S ratio of 1 or under and that had a Zacks #1 (Strong Buy) rank, which indicates rising earnings estimates.
18 stocks came up in her screen so she whittled it down to these 3 top stocks.
3 Value Stocks with the Powerful Combination
1. First American Corporation (NYSE:(FAF - Free Report) – Free Report) has a forward P/E of 14.1 and the full year estimate has jumped to $3.42 from $3.28 in the last 90 days. Don’t overlook this title insurance company.
2. ManpowerGroup (NYSE:(MAN - Free Report) – Free Report) is a worldwide staffing company. Shares sold off after its last earnings report BUT earnings estimates were also adjusted higher. That brought the stock back to value territory. It has a P/E of 15.9. Earnings are expected to be $6.73, up from $6.55 just 90 days ago.
3. LPL Financial (NASDAQ:(LPLA - Free Report) – Free Report) is the largest independent brokerage firm in the United States with over 14,000 independent financial advisors. Over the last 3 months, the 2017 Zacks Consensus Estimate has jumped to $2.62 from $2.42. Earnings are expected to grow 23%. It has a P/S ratio of 1.o.
What else should you know about the powerful combination of rising earnings estimates and value investing?
Find out on this week’s podcast.
Want more value investing insights from Tracey?
Value investors are a special breed of investor. They don’t follow the herd.
If that is your style of investing, be sure to check out Tracey’s weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks she thinks are the best bargains now.
The Value Investor portfolio holds between 20 and 25 value stocks for the long haul.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Zacks Value Trader Highlights: Applied Optoelectronics, First American, ManpowerGroup and LPL Financial
For Immediate Release
Chicago, IL –Aug 04, 2017 – Zacks Value Trader is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here: (Please use the Soundcloud link from this URL for the PR. Thanks: https://www.zacks.com/stock/news/270479/what-is-the-most-powerful-combination-in-value-investing)
What’s the Most Powerful Combination in Value Investing
Welcome to Episode #53 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio service, shares some of her top value investing tips and stock picks.
It’s the middle of earnings season and many are complaining about the valuation of the stock markets (again).
Several of the major indexes continue to hit new all-time highs which has some investors fretting. But there are still value stocks out there despite stocks moving higher every month.
The Key for Value Investors
Most value investors look to one key metric to start their value stock search: The P/E ratio. Remember that the P/E is price divided by earnings.
During earnings season, we’re getting new information about the “E”, or earnings, in the P/E. For some companies, the “E” will dramatically rise.
If that company’s stock is also rising, it may remain a value stock because the “E” is rising.
For value investors, a rising “E” is critical.
Why Rising Earnings Matter for Value Investors
An example of the importance of the rising “E” can be found with Applied Optoelectronics (NASDAQ:(AAOI - Free Report) – Free Report). Tracey has covered it on prior podcasts because it was a value stock that was up over 100% in 2017.
How could its valuation still be attractive with that kind of stock move?
Ninety days ago, analysts believed Applied Opto would make just $3.76 a share this year. But the estimate has been slowly rising the last 3 months and now sits at $4.95.
Because of rising earnings estimates, Applied Opto has a forward P/E of 19.7. That’s not much higher than the average of the S&P 500.
It would have a P/E of about 25 if the “E” wasn’t exploding to the upside and had remained around $3.76.
The Most Powerful Combination
Value investors obviously want solid value fundamentals when buying a stock. But if they can also get rising earnings estimates at the same time, then something truly special may be going on there.
Tracey did a screen for stocks with P/Es under 20, a P/S ratio of 1 or under and that had a Zacks #1 (Strong Buy) rank, which indicates rising earnings estimates.
18 stocks came up in her screen so she whittled it down to these 3 top stocks.
3 Value Stocks with the Powerful Combination
1. First American Corporation (NYSE:(FAF - Free Report) – Free Report) has a forward P/E of 14.1 and the full year estimate has jumped to $3.42 from $3.28 in the last 90 days. Don’t overlook this title insurance company.
2. ManpowerGroup (NYSE:(MAN - Free Report) – Free Report) is a worldwide staffing company. Shares sold off after its last earnings report BUT earnings estimates were also adjusted higher. That brought the stock back to value territory. It has a P/E of 15.9. Earnings are expected to be $6.73, up from $6.55 just 90 days ago.
3. LPL Financial (NASDAQ:(LPLA - Free Report) – Free Report) is the largest independent brokerage firm in the United States with over 14,000 independent financial advisors. Over the last 3 months, the 2017 Zacks Consensus Estimate has jumped to $2.62 from $2.42. Earnings are expected to grow 23%. It has a P/S ratio of 1.o.
What else should you know about the powerful combination of rising earnings estimates and value investing?
Find out on this week’s podcast.
Want more value investing insights from Tracey?
Value investors are a special breed of investor. They don’t follow the herd.
If that is your style of investing, be sure to check out Tracey’s weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks she thinks are the best bargains now.
The Value Investor portfolio holds between 20 and 25 value stocks for the long haul.
Click here to learn more>>>
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.