Yahoo Finance Is Brother Industries (BRTHY) Stock Undervalued Right Now?
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Brother Industries (BRTHY). BRTHY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 11.35, while its industry has an average P/E of 17.34. Over the last 12 months, BRTHY's Forward P/E has been as high as 12.47 and as low as 9.16, with a median of 10.04.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. BRTHY has a P/S ratio of 0.71. This compares to its industry's average P/S of 0.83.
Finally, investors will want to recognize that BRTHY has a P/CF ratio of 7.09. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.80. Within the past 12 months, BRTHY's P/CF has been as high as 7.54 and as low as 4.97, with a median of 6.23.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Brother Industries is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BRTHY feels like a great value stock at the moment.
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Brother Industries Ltd. (BRTHY) : Free Stock Analysis Report
