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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.
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.
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.
Yara International ASA (YARIY) is a stock many investors are watching right now. YARIY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 4.78. This compares to its industry's average Forward P/E of 6.58. YARIY's Forward P/E has been as high as 14.78 and as low as 4.78, with a median of 11.44, all within the past year.
Investors should also recognize that YARIY has a P/B ratio of 1.63. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.97. Over the past 12 months, YARIY's P/B has been as high as 2.05 and as low as 1.46, with a median of 1.79.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. YARIY has a P/S ratio of 0.59. This compares to its industry's average P/S of 1.72.
Finally, investors will want to recognize that YARIY has a P/CF ratio of 4.91. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 8.37. Over the past year, YARIY's P/CF has been as high as 9.84 and as low as 4.91, with a median of 7.88.
These are only a few of the key metrics included in Yara International ASA'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, YARIY looks like an impressive value stock at the moment.
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