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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.
One company to watch right now is Black Stone Minerals (BSM). BSM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 10.50, while its industry has an average P/E of 13.82. Over the past 52 weeks, BSM's Forward P/E has been as high as 16.86 and as low as 5.17, with a median of 13.24.
Another valuation metric that we should highlight is BSM's P/B ratio of 1.72. Investors use the P/B ratio to look at a stock's market value versus 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 2.47. Within the past 52 weeks, BSM's P/B has been as high as 4.19 and as low as 1.07, with a median of 3.23.
Finally, our model also underscores that BSM has a P/CF ratio of 3.59. 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. BSM's P/CF compares to its industry's average P/CF of 7.63. BSM's P/CF has been as high as 8.47 and as low as 2.40, with a median of 5.40, all within the past year.
These are only a few of the key metrics included in Black Stone Minerals'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, BSM looks like an impressive value stock at the moment.
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Black Stone Minerals, L.P. (BSM) : Free Stock Analysis Report
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