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Should Value Investors Buy Aveanna Healthcare (AVAH) Stock?

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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 the latest value, growth, and momentum trends to underscore strong picks.

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.

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 to watch right now is Aveanna Healthcare (AVAH - Free Report) . AVAH is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. AVAH has a P/S ratio of 0.56. This compares to its industry's average P/S of 1.44.

Finally, investors will want to recognize that AVAH has a P/CF ratio of 68.62. 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. AVAH's current P/CF looks attractive when compared to its industry's average P/CF of 178.97. Over the past year, AVAH's P/CF has been as high as 221.43 and as low as 8.31, with a median of 68.87.

These are just a handful of the figures considered in Aveanna Healthcare'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 AVAH is an impressive value stock right now.


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