Core Insights - The article discusses the importance of the price-to-book (P/B) ratio in value investing, highlighting its utility in identifying undervalued stocks with strong growth potential [1][2]. Group 1: Understanding P/B Ratio - The P/B ratio is calculated by dividing the current stock price by the book value per share, indicating how much investors pay for each dollar of book value [2][6]. - A P/B ratio of less than one suggests that a stock is undervalued, while a ratio greater than one indicates it may be overvalued [6][7]. - The P/B ratio is particularly relevant for industries with tangible assets, such as finance and manufacturing, but may be misleading for companies with high R&D expenses or negative earnings [9][10]. Group 2: Investment Opportunities - Five stocks identified as having low P/B ratios include StoneCo (STNE), CVS Health (CVS), KT Corporation (KT), KB Financial Group (KB), and USANA Health Sciences (USNA) [11][16]. - These stocks have Zacks Rank 1 or 2 and Value Scores of A or B, with projected EPS growth rates ranging from 11.9% to 49.9%, indicating strong potential [11][17][19][20][21]. Group 3: Screening Parameters - Screening parameters for identifying attractive stocks include P/B ratio less than the industry median, P/S ratio less than the industry median, and P/E ratio less than the industry median [12][13]. - A PEG ratio of less than 1 indicates undervaluation relative to future growth prospects, while a minimum stock price of $5 and an average trading volume of at least 100,000 are also considered [14][15].

Key Takeaways It is calculated by subtracting total liabilities from the total assets of a company. In most cases, this equates to common stockholders' equity on the balance sheet. However, depending on the company's balance sheet, intangible assets should also be subtracted from the total assets to determine book value. Understanding P/B Ratio By comparing the book value of equity to its market price, we get an idea of whether a company is under- or overpriced. However, like P/E or P/S ratio, it is always ...

Group 1 - Zacks Premium offers various tools to help investors become more confident and informed, including daily updates on Zacks Rank and Industry Rank, Equity Research reports, and Premium stock screens [1][2] - The Zacks Style Scores are complementary indicators that rate stocks based on value, growth, and momentum, helping investors identify stocks with the best chances of outperforming the market in the short term [3][4] Group 2 - The Value Score focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, and Price/Sales, appealing to value investors [4] - The Growth Score emphasizes a company's financial health and future outlook, analyzing projected and historical earnings, sales, and cash flow to find stocks with sustainable growth [5] - The Momentum Score identifies trends in stock prices and earnings outlooks, assisting momentum traders in timing their investments based on recent price changes [6] Group 3 - The VGM Score combines the Value, Growth, and Momentum Scores, providing a comprehensive rating that helps investors find stocks with attractive value, strong growth potential, and positive momentum [7] - The Zacks Rank, a proprietary stock-rating model, uses earnings estimate revisions to simplify portfolio building, with 1 (Strong Buy) stocks achieving an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8][9] Group 4 - CVS Health Corporation is highlighted as a stock to watch, currently rated 2 (Buy) on the Zacks Rank with a VGM Score of A, indicating strong potential [12] - CVS has a Value Style Score of A, supported by a forward P/E ratio of 10.89, making it attractive to value investors [13] - Recent upward revisions in earnings estimates by 12 analysts and an increase in the Zacks Consensus Estimate to $6.11 per share further enhance CVS's investment appeal, alongside an average earnings surprise of 18.1% [13]