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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.
Miller Industries (MLR) is a stock many investors are watching right now. MLR is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 13.22, which compares to its industry's average of 19.95. Over the past 52 weeks, MLR's Forward P/E has been as high as 13.67 and as low as 7.41, with a median of 11.47.
We should also highlight that MLR has a P/B ratio of 1.32. 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 3.47. Over the past year, MLR's P/B has been as high as 2.23 and as low as 1.10, with a median of 1.83.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. MLR has a P/S ratio of 0.48. This compares to its industry's average P/S of 0.6.
Strattec Security (STRT) may be another strong Automotive - Original Equipment stock to add to your shortlist. STRT is a # 1 (Strong Buy) stock with a Value grade of A.
Strattec Security is trading at a forward earnings multiple of 10.90 at the moment, with a PEG ratio of 1.09. This compares to its industry's average P/E of 19.95 and average PEG ratio of 1.41.
STRT's Forward P/E has been as high as 26.50 and as low as 8.54, with a median of 15.45. During the same time period, its PEG ratio has been as high as 2.65, as low as 0.85, with a median of 1.54.