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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is Modine (MOD). MOD is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MOD has a P/S ratio of 0.13. This compares to its industry's average P/S of 0.3.
Finally, we should also recognize that MOD has a P/CF ratio of 2.54. 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. MOD's current P/CF looks attractive when compared to its industry's average P/CF of 7.78. MOD's P/CF has been as high as 5.77 and as low as 2.54, with a median of 4.31, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Modine is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MOD feels like a great value stock at the moment.
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Modine Manufacturing Company (MOD) : Free Stock Analysis Report
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