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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.
Rush Enterprises (RUSHA) is a stock many investors are watching right now. RUSHA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
Investors will also notice that RUSHA has a PEG ratio of 1.35. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company’s expected earnings growth rate. RUSHA’s PEG compares to its industry’s average PEG of 1.84. Over the past 52 weeks, RUSHA’s PEG has been as high as 1.89 and as low as 0.64, with a median of 0.90.
Finally, we should also recognize that RUSHA has a P/CF ratio of 6.59. 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 11.41. Within the past 12 months, RUSHA’s P/CF has been as high as 6.64 and as low as 3.32, with a median of 5.09.
These are only a few of the key metrics included in Rush Enterprises’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, RUSHA looks like an impressive value stock at the moment.
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