While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
CACI International (CACI) is a stock many investors are watching right now. CACI is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 16.85. This compares to its industry's average Forward P/E of 18.93. CACI's Forward P/E has been as high as 20.63 and as low as 13.45, with a median of 17.30, all within the past year.
Investors should also note that CACI holds a PEG ratio of 1.68. 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. CACI's industry currently sports an average PEG of 1.69. Within the past year, CACI's PEG has been as high as 2.06 and as low as 1.34, with a median of 1.73.
Investors should also recognize that CACI has a P/B ratio of 1.98. 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 attractive against its industry's average P/B of 3.21. Over the past year, CACI's P/B has been as high as 2.33 and as low as 1.55, with a median of 1.96.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CACI has a P/S ratio of 0.96. This compares to its industry's average P/S of 1.17.
Value investors will likely look at more than just these metrics, but the above data helps show that CACI International is likely undervalued currently. And when considering the strength of its earnings outlook, CACI sticks out at as one of the market's strongest value stocks.
CACI International, Inc. (CACI): Free Stock Analysis Report
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Zacks Investment Research