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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.
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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
Subaru Corporation (FUJHY) is a stock many investors are watching right now. FUJHY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 3.76, which compares to its industry's average of 9.27. Over the past 52 weeks, FUJHY's Forward P/E has been as high as 7.29 and as low as 3.59, with a median of 6.09.
Another notable valuation metric for FUJHY is its P/B ratio of 0.76. The P/B is a method of comparing a stock's market value to 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 0.90. Over the past 12 months, FUJHY's P/B has been as high as 1.07 and as low as 0.67, with a median of 0.84.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. FUJHY has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.46.
Finally, investors should note that FUJHY has a P/CF ratio of 3.15. 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. FUJHY's current P/CF looks attractive when compared to its industry's average P/CF of 4.49. FUJHY's P/CF has been as high as 4.28 and as low as 2.77, with a median of 3.46, all within the past year.
These are just a handful of the figures considered in Subaru Corporation's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FUJHY is an impressive value stock right now.