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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 company to watch right now is DICK'S Sporting Goods (DKS). DKS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 13.57, while its industry has an average P/E of 16.38. Over the past 52 weeks, DKS's Forward P/E has been as high as 16.96 and as low as 9.39, with a median of 14.29.
Finally, investors should note that DKS has a P/CF ratio of 10.58. 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. DKS's current P/CF looks attractive when compared to its industry's average P/CF of 18.48. Within the past 12 months, DKS's P/CF has been as high as 13.46 and as low as 7.07, with a median of 11.14.
These figures are just a handful of the metrics value investors tend to look at, but they help show that DICK'S Sporting Goods is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, DKS feels like a great value stock at the moment.
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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.
