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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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
Seven and I Holdings Co. (SVNDY) is a stock many investors are watching right now. SVNDY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 13.55 right now. For comparison, its industry sports an average P/E of 16.14. Over the last 12 months, SVNDY's Forward P/E has been as high as 19.06 and as low as 9.88, with a median of 12.65.
Finally, we should also recognize that SVNDY has a P/CF ratio of 7.64. 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. SVNDY's current P/CF looks attractive when compared to its industry's average P/CF of 16.89. Over the past year, SVNDY's P/CF has been as high as 8.49 and as low as 5.65, with a median of 7.09.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Seven and I Holdings Co. Is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SVNDY feels like a great value stock at the moment.
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This article originally published on Zacks Investment Research (zacks.com).