Is Textron (TXT) a Great Value Stock Right Now?
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...
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Textron (TXT). TXT is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
Investors will also notice that TXT has a PEG ratio of 0.67. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. TXT's PEG compares to its industry's average PEG of 1.93. TXT's PEG has been as high as 6.49 and as low as 0.64, with a median of 0.93, all within the past year.
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. TXT has a P/S ratio of 1.27. This compares to its industry's average P/S of 1.33.
These are only a few of the key metrics included in Textron's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, TXT looks like an impressive value stock at the moment.
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Textron Inc. (TXT): Free Stock Analysis Report
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