Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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.
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 company value investors might notice is Concrete Pumping Holdings (BBCP). BBCP is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BBCP has a P/S ratio of 1.2. This compares to its industry's average P/S of 2.97.
Finally, we should also recognize that BBCP has a P/CF ratio of 5.60. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 13.67. Over the past year, BBCP's P/CF has been as high as 6.45 and as low as 3.49, with a median of 4.73.
These are only a few of the key metrics included in Concrete Pumping Holdings'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, BBCP looks like an impressive value stock at the moment.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
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