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Should Value Investors Buy Fullgent Genetics (FLGT) Stock?

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...

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This story originally appeared on Zacks

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.

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Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Fullgent Genetics (FLGT). FLGT is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

Another notable valuation metric for FLGT is its P/B ratio of 2.66. 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. FLGT's current P/B looks attractive when compared to its industry's average P/B of 4.57. Over the past 12 months, FLGT's P/B has been as high as 7.84 and as low as 2.22, with a median of 3.01.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. FLGT has a P/S ratio of 2.69. This compares to its industry's average P/S of 5.

These are just a handful of the figures considered in Fullgent Genetics's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FLGT is an impressive value stock right now.



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