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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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 company value investors might notice is Eagle Bancorp (EGBN). EGBN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 10.80 right now. For comparison, its industry sports an average P/E of 11.25. Over the past 52 weeks, EGBN's Forward P/E has been as high as 15.48 and as low as 7.61, with a median of 10.88.
Another notable valuation metric for EGBN is its P/B ratio of 0.66. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. EGBN's current P/B looks attractive when compared to its industry's average P/B of 1.37. EGBN's P/B has been as high as 0.74 and as low as 0.39, with a median of 0.56, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. EGBN has a P/S ratio of 1.12. This compares to its industry's average P/S of 1.95.
Finally, our model also underscores that EGBN has a P/CF ratio of 12.54. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. EGBN's P/CF compares to its industry's average P/CF of 13.91. Over the past 52 weeks, EGBN's P/CF has been as high as 12.84 and as low as 5.76, with a median of 8.23.
Financial Institutions (FISI) may be another strong Banks - Northeast stock to add to your shortlist. FISI is a # 1 (Strong Buy) stock with a Value grade of A.