The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the “Value” category. Stocks with high Zacks Ranks and “A” grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is Equinor (EQNR). EQNR is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 9.02, while its industry has an average P/E of 9.26. Over the past 52 weeks, EQNR’s Forward P/E has been as high as 17.17 and as low as 7.57, with a median of 11.59.
Investors will also notice that EQNR has a PEG ratio of 0.18. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company’s expected EPS growth rate. EQNR’s PEG compares to its industry’s average PEG of 0.31. Over the past 52 weeks, EQNR’s PEG has been as high as 3.13 and as low as 0.15, with a median of 0.24.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock’s price with the company’s sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. EQNR has a P/S ratio of 1.47. This compares to its industry’s average P/S of 2.68.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Equinor is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, EQNR feels like a great value stock at the moment.
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