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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.
PLDT (PHI) is a stock many investors are watching right now. PHI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 7.83, which compares to its industry's average of 9.36. Over the past 52 weeks, PHI's Forward P/E has been as high as 10.14 and as low as 7.06, with a median of 8.55.
Finally, investors will want to recognize that PHI has a P/CF ratio of 3.22. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. PHI's current P/CF looks attractive when compared to its industry's average P/CF of 4.21. Over the past 52 weeks, PHI's P/CF has been as high as 4.05 and as low as 2.88, with a median of 3.37.
These are only a few of the key metrics included in PLDT'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, PHI looks like an impressive value stock at the moment.
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This article originally published on Zacks Investment Research (zacks.com).