ZACKSยท2025-04-30 20:00Core Viewpoint - In times of market volatility, value investing becomes a preferred strategy as investors seek to buy undervalued stocks when others are selling at lower prices [1][2]. Value Investing Strategy - Value investors capitalize on market uncertainty by purchasing stocks at discounted prices when other investors sell [1]. - The strategy can lead to "value traps" if not understood properly, where stocks underperform due to persistent issues rather than temporary problems [3]. Importance of PEG Ratio - The PEG ratio, defined as (Price/Earnings)/Earnings Growth Rate, is a crucial metric for value investors, as a low PEG ratio indicates better value [5]. - Unlike P/E alone, the PEG ratio helps identify a stock's intrinsic value, although it has limitations regarding changing growth rates [5]. Screening Criteria for Value Stocks - Effective screening for value stocks includes criteria such as: - PEG Ratio less than industry median - P/E Ratio less than industry median - Zacks Rank 1 (Strong Buy) or 2 (Buy) - Market Capitalization greater than $1 billion - Average 20-Day Volume greater than 50,000 - Percentage Change in F1 Earnings Estimate Revisions greater than 5% - Value Score of A or B combined with a Zacks Rank of 1, 2, or 3 [6]. Selected Stocks - Barrick Gold (GOLD): A leading gold mining company with 3.9 million ounces of gold and 195,000 tons of copper produced in 2024, holding 89 million ounces of proven and probable gold reserves. It has a Zacks Rank 2 and a Value Score of A, with a five-year expected growth rate of 33.5% [8][9]. - StoneCo (STNE): A financial technology company in Brazil providing various financial services. It has a Zacks Rank 1 and a Value Score of B, with a long-term expected growth rate of 26.3% [9][10]. - Synovus Financial (SNV): A diverse financial services company with a Zacks Rank 2 and a Value Score of A, boasting a five-year expected growth rate of 10.2% [11][12]. - BGC Group, Inc. (BGC): A financial brokerage and technology company with a long-term expected earnings growth rate of 24.7%, holding a Value Score of B and a Zacks Rank of 1 [12][13].