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Should Value Investors Buy Helen of Troy (HELE) Stock?

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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 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 value investors might notice is Helen of Troy (HELE - Free Report) . HELE is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

We also note that HELE holds a PEG ratio of 1.48. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HELE's industry has an average PEG of 1.57 right now. HELE's PEG has been as high as 1.73 and as low as 0.79, with a median of 1.21, all within the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. HELE has a P/S ratio of 0.68. This compares to its industry's average P/S of 0.99.

Finally, investors should note that HELE has a P/CF ratio of 7.79. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 24.16. HELE's P/CF has been as high as 14.21 and as low as 5.59, with a median of 8.65, all within the past year.

These are only a few of the key metrics included in Helen of Troy'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, HELE looks like an impressive value stock at the moment.


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