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 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.
Babcock International Group (BCKIY) is a stock many investors are watching right now. BCKIY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 8.90 right now. For comparison, its industry sports an average P/E of 19.42. Over the past 52 weeks, BCKIY's Forward P/E has been as high as 9.46 and as low as 6.84, with a median of 7.60.
Another valuation metric that we should highlight is BCKIY's P/B ratio of 2.35. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. BCKIY's current P/B looks attractive when compared to its industry's average P/B of 3.80. Within the past 52 weeks, BCKIY's P/B has been as high as 2.59 and as low as 1.92, with a median of 2.11.
These are only a few of the key metrics included in Babcock International Group's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, BCKIY looks like an impressive value stock at the moment.
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