Are Investors Undervaluing First Community (FCCO) 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...
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.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
First Community (FCCO) is a stock many investors are watching right now. FCCO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.20, while its industry has an average P/E of 12.21. FCCO's Forward P/E has been as high as 15.38 and as low as 10.07, with a median of 11.47, all within the past year.
Investors should also recognize that FCCO has a P/B ratio of 1.09. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.78. Over the past 12 months, FCCO's P/B has been as high as 1.21 and as low as 0.90, with a median of 1.10.
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. FCCO has a P/S ratio of 2.52. This compares to its industry's average P/S of 3.18.
Finally, investors will want to recognize that FCCO has a P/CF ratio of 8.01. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. FCCO's current P/CF looks attractive when compared to its industry's average P/CF of 15.95. Within the past 12 months, FCCO's P/CF has been as high as 11.29 and as low as 7.69, with a median of 9.14.
These figures are just a handful of the metrics value investors tend to look at, but they help show that First Community is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FCCO feels like a great value stock at the moment.
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