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Should Value Investors Buy Seven and I Holdings Co. (SVNDY) 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.

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.

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 Seven and I Holdings Co. (SVNDY - Free Report) . SVNDY is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 11.75, which compares to its industry's average of 16.73. Over the last 12 months, SVNDY's Forward P/E has been as high as 19.06 and as low as 9.88, with a median of 12.97.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. SVNDY has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.77.

Finally, our model also underscores that SVNDY has a P/CF ratio of 8.15. 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. SVNDY's P/CF compares to its industry's average P/CF of 18.67. Over the past 52 weeks, SVNDY's P/CF has been as high as 8.49 and as low as 5.65, with a median of 7.36.

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


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