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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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company to watch right now is Ethan Allen Interiors Inc. (ETD). ETD is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 10.95. This compares to its industry's average Forward P/E of 20.69. Over the past year, ETD's Forward P/E has been as high as 13.49 and as low as 10, with a median of 11.88.
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. ETD has a P/S ratio of 1.11. This compares to its industry's average P/S of 1.32.
Finally, our model also underscores that ETD has a P/CF ratio of 9.14. 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. ETD's current P/CF looks attractive when compared to its industry's average P/CF of 14.10. Within the past 12 months, ETD's P/CF has been as high as 10.56 and as low as 7.95, with a median of 9.46.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Ethan Allen Interiors Inc. Is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ETD feels like a great value stock at the moment.
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Ethan Allen Interiors Inc. (ETD) : Free Stock Analysis Report