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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.
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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 to watch right now is City Office REIT (CIO). CIO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
Investors will also notice that CIO has a PEG ratio of 0.69. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CIO's PEG compares to its industry's average PEG of 1.75. Over the last 12 months, CIO's PEG has been as high as 0.94 and as low as 0.61, with a median of 0.78.
Finally, our model also underscores that CIO has a P/CF ratio of 4.36. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. CIO's P/CF compares to its industry's average P/CF of 13.94. Over the past year, CIO's P/CF has been as high as 5.17 and as low as 2.87, with a median of 4.10.
These figures are just a handful of the metrics value investors tend to look at, but they help show that City Office REIT is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CIO feels like a great value stock at the moment.
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City Office REIT, Inc. (CIO) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).