While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 to watch right now is Yanzhou Coal Mining (YZCAY). YZCAY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 3.38, which compares to its industry's average of 4.15. Over the past year, YZCAY's Forward P/E has been as high as 7.62 and as low as 2.95, with a median of 3.50.
Another notable valuation metric for YZCAY is its P/B ratio of 1.05. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.75. Within the past 52 weeks, YZCAY's P/B has been as high as 1.24 and as low as 0.72, with a median of 0.96.
These are just a handful of the figures considered in Yanzhou Coal Mining's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that YZCAY is an impressive value stock right now.
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