Should Value Investors Buy Harte Hanks (HHS) Stock?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Harte Hanks (HHS). HHS is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 10.05, which compares to its industry's average of 10.59. Over the last 12 months, HHS's Forward P/E has been as high as 40.77 and as low as 4.24, with a median of 7.80.
HHS is also sporting a PEG ratio of 0.84. 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. HHS's industry has an average PEG of 1.45 right now. Over the last 12 months, HHS's PEG has been as high as 3.40 and as low as 0.35, with a median of 0.65.
We should also highlight that HHS has a P/B ratio of 2.56. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. HHS's current P/B looks attractive when compared to its industry's average P/B of 5.42. HHS's P/B has been as high as 2.87 and as low as 1.80, with a median of 2.39, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. HHS has a P/S ratio of 0.27. This compares to its industry's average P/S of 0.44.
Value investors will likely look at more than just these metrics, but the above data helps show that Harte Hanks is likely undervalued currently. And when considering the strength of its earnings outlook, HHS sticks out at as one of the market's strongest value stocks.
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Harte Hanks, Inc. (HHS) : Free Stock Analysis Report
