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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Hawaiian Holdings (HA) is a stock many investors are watching right now. HA is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 7.22, which compares to its industry's average of 8.94. Over the past 52 weeks, HA's Forward P/E has been as high as 8.36 and as low as 4.77, with a median of 7.08.
Another valuation metric that we should highlight is HA's P/B ratio of 1.33. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.80. Within the past 52 weeks, HA's P/B has been as high as 2.42 and as low as 1.23, with a median of 1.63.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. HA has a P/S ratio of 0.47. This compares to its industry's average P/S of 0.59.
Finally, we should also recognize that HA has a P/CF ratio of 3.39. 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. HA's P/CF compares to its industry's average P/CF of 6.19. HA's P/CF has been as high as 5 and as low as 2.71, with a median of 3.86, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Hawaiian Holdings is likely undervalued currently. And when considering the strength of its earnings outlook, HA sticks out at as one of the market's strongest value stocks.
Hawaiian Holdings, Inc. (HA): Free Stock Analysis Report
Original post
Zacks Investment Research