Is Bassett Furniture Industries (BSET) Stock Undervalued Right Now?

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Bassett Furniture Industries (BSET). BSET is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 8.17, which compares to its industry's average of 13.84. Over the past 52 weeks, BSET's Forward P/E has been as high as 19.73 and as low as 6.36, with a median of 8.76.

BSET is also sporting a PEG ratio of 0.51. 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. BSET's industry currently sports an average PEG of 0.77. Over the past 52 weeks, BSET's PEG has been as high as 1.23 and as low as 0.40, with a median of 0.55.

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. BSET has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.42.

Finally, we should also recognize that BSET has a P/CF ratio of 4.90. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. BSET's current P/CF looks attractive when compared to its industry's average P/CF of 11.46. Within the past 12 months, BSET's P/CF has been as high as 47.89 and as low as 4.02, with a median of 5.33.

Investors could also keep in mind Virco Manufacturing (VIRC), an Furniture stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Virco Manufacturing also has a P/B ratio of 0.81 compared to its industry's price-to-book ratio of 3.13. Over the past year, its P/B ratio has been as high as 1.20, as low as 0.78, with a median of 0.93.

These are just a handful of the figures considered in Bassett Furniture Industries and Virco Manufacturing'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 BSET and VIRC is an impressive value stock right now.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.