Are Investors Undervaluing 8x8 (EGHT) 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

8x8 (EGHT) is a stock many investors are watching right now. EGHT is currently holding a Zacks Rank #2 (Buy) and a Value grade of A.

EGHT is also sporting a PEG ratio of 0.71. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. EGHT's industry currently sports an average PEG of 0.84. Over the past 52 weeks, EGHT's PEG has been as high as 0.79 and as low as 0.35, with a median of 0.59.

We should also highlight that EGHT has a P/B ratio of 2.22. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 4.15. Within the past 52 weeks, EGHT's P/B has been as high as 4.01 and as low as 1.70, with a median of 2.31.

Finally, our model also underscores that EGHT has a P/CF ratio of 5.30. 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. EGHT's P/CF compares to its industry's average P/CF of 14.19. Within the past 12 months, EGHT's P/CF has been as high as 23.04 and as low as 4.00, with a median of 7.51.

Value investors will likely look at more than just these metrics, but the above data helps show that 8x8 is likely undervalued currently. And when considering the strength of its earnings outlook, EGHT sticks out as one of the market's strongest value stocks.

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This article originally published on Zacks Investment Research (zacks.com).

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