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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.
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.
One stock to keep an eye on is Oshkosh (OSK). OSK is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 9.78. This compares to its industry's average Forward P/E of 23.07. OSK's Forward P/E has been as high as 12.12 and as low as 8.25, with a median of 9.56, all within the past year.
Investors should also recognize that OSK has a P/B ratio of 1.71. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 3.90. Over the past 12 months, OSK's P/B has been as high as 2.20 and as low as 1.40, with a median of 1.77.
Investors could also keep in mind Strattec Security (STRT), an Automotive - Original Equipment stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Shares of Strattec Security are currently trading at a forward earnings multiple of 13.63 and a PEG ratio of 1.36 compared to its industry's P/E and PEG ratios of 23.07 and 1.18, respectively.
STRT's price-to-earnings ratio has been as high as 26.50 and as low as 12.04, with a median of 16.43, while its PEG ratio has been as high as 2.65 and as low as 1.20, with a median of 1.64, all within the past year.
Additionally, Strattec Security has a P/B ratio of 0.94 while its industry's price-to-book ratio sits at 3.90. For STRT, this valuation metric has been as high as 0.94, as low as 0.40, with a median of 0.64 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Oshkosh and Strattec Security are likely undervalued currently. And when considering the strength of its earnings outlook, OSK and STRT sticks out as one of the market's strongest value stocks.