Workflow
Buy These 5 Low Price-to-Book Value Stocks in June
The ODP The ODP (US:ODP) ZACKSยท2024-06-03 13:26

Core Insights - Value investing provides an opportunity to acquire overlooked stocks trading at low multiples, with the price-to-book (P/B) ratio being a useful metric for identifying such stocks [1][3] - The P/B ratio is calculated by dividing market capitalization by book value of equity, helping to identify undervalued stocks with high growth potential [1][3] - A P/B ratio of less than one indicates a stock is undervalued, while a ratio greater than one suggests it may be overvalued [3][4] Book Value - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities, calculated by subtracting total liabilities from total assets [2] - Intangible assets should be excluded from total assets to accurately determine book value [2] P/B Ratio Analysis - The P/B ratio should be compared within industries for better context, as a standalone number may not provide sufficient insight [3][5] - A P/B ratio below one can indicate weak asset returns or overstated assets, while a ratio above one may suggest the stock is a takeover target [4] Screening Parameters - Stocks with a P/B ratio lower than the industry median may have potential for price appreciation [6] - Additional screening metrics include P/S ratio, P/E ratio, PEG ratio, minimum price thresholds, trading volume, Zacks Rank, and Value Score [7][8] Stock Examples - KB Home (KBH) has a projected 3-5 year EPS growth rate of 11.06%, Zacks Rank 2, and Value Score A [9] - Qifu Technology (QFIN) has a projected EPS growth rate of 10.87%, Zacks Rank 2, and Value Score A [9] - ODP Corporation (ODP) has a projected EPS growth rate of 14.0%, Zacks Rank 1, and Value Score A [10] - Tri Pointe Homes (TPH) has a projected EPS growth rate of 13.0%, Zacks Rank 1, and Value Score A [10] - Gray Television (GTN) has a projected EPS growth rate of 10.0%, Zacks Rank 1, and Value Score A [10]