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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.
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.
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.
One stock to keep an eye on is Ceragon Networks (CRNT). CRNT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 6.62. This compares to its industry's average Forward P/E of 9.67. Over the last 12 months, CRNT's Forward P/E has been as high as 17.50 and as low as 6.62, with a median of 12.41.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CRNT has a P/S ratio of 0.45. This compares to its industry's average P/S of 1.05.
Finally, we should also recognize that CRNT has a P/CF ratio of 5.10. 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. CRNT's P/CF compares to its industry's average P/CF of 14.02. CRNT's P/CF has been as high as 18.38 and as low as 5.10, with a median of 11.37, all within the past year.
These are just a handful of the figures considered in Ceragon Networks'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 CRNT is an impressive value stock right now.
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Ceragon Networks Ltd. (CRNT) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).