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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system’s “Value” category. Stocks with both “A” grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is FULGENT GENETIC (FLGT). FLGT is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is FLGT’s P/B ratio of 2.65. The P/B is a method of comparing a stock’s market value to its book value, which is defined as total assets minus total liabilities. FLGT’s current P/B looks attractive when compared to its industry’s average P/B of 4.45. Over the past 12 months, FLGT’s P/B has been as high as 7.84 and as low as 2.22, with a median of 3.10.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. FLGT has a P/S ratio of 2.72. This compares to its industry’s average P/S of 4.85.
Finally, our model also underscores that FLGT has a P/CF ratio of 5.07. This data point considers a firm’s operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company’s current P/CF looks solid when compared to its industry’s average P/CF of 20.05. Over the past 52 weeks, FLGT’s P/CF has been as high as 23.82 and as low as 4.58, with a median of 6.72.
These are just a handful of the figures considered in FULGENT GENETIC’s great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FLGT is an impressive value stock right now.
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