Are Investors Undervaluing Carter's (CRI) Right Now?
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
One company value investors might notice is Carter's (CRI). CRI is currently sporting a Zacks Rank #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 11.92, which compares to its industry's average of 18.49. Over the last 12 months, CRI's Forward P/E has been as high as 14.58 and as low as 7.27, with a median of 10.72.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CRI has a P/S ratio of 0.46. This compares to its industry's average P/S of 0.86.
Value investors will likely look at more than just these metrics, but the above data helps show that Carter's is likely undervalued currently. And when considering the strength of its earnings outlook, CRI sticks out as one of the market's strongest value stocks.
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Carter's, Inc. (CRI): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
