Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 Chico's FAS (CHS). CHS is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CHS has a P/S ratio of 0.34. This compares to its industry's average P/S of 0.57.
Finally, our model also underscores that CHS has a P/CF ratio of 4.18. 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. This stock's P/CF looks attractive against its industry's average P/CF of 7.90. Within the past 12 months, CHS's P/CF has been as high as 7.10 and as low as 3.41, with a median of 5.68.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Chico's FAS is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CHS feels like a great value stock at the moment.
Chico's FAS, Inc. (CHS): Free Stock Analysis Report
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