Value investing is about seizing opportunities in stocks trading at a discount, banking on the market eventually acknowledging their true worth, potentially leading to substantial gains. After all, who doesn’t love a good bargain?
Enhancing this strategy with the Zacks Rank can amplify returns by pinpointing stocks that analysts have recently turned bullish on.
JD.com
Operating as an online direct sales company in China, JD.com holds the coveted Zacks Rank #1 (Strong Buy) status, with earnings expectations on the rise across various time frames. Currently, its shares trade at a 7.8X forward 12-month earnings multiple, a mere fraction of historical metrics at 39.0X and 84.9X. The forward 12-month price-to-sales ratio sits at 0.3X, significantly below the five-year median of 0.5X.
The company boasts a track record of consistently surpassing Zacks Consensus EPS estimates in its last ten quarterly releases.
Image Source: Zacks Investment Research
KB Home
KB Home, a prominent homebuilder in the U.S., has garnered bullish sentiment from analysts, pushing it into a Zacks Rank #1 (Strong Buy). Presently, its shares trade at a 7.3X forward 12-month earnings multiple, slightly below historical averages. The forward 12-month price-to-sales ratio stands at 0.6X, a notch under past highs.
Image Source: Zacks Investment Research
AllianceBernstein
AllianceBernstein, an investment management services provider, currently holds a Zacks Rank #2 (Buy). Analysts’ favorable revisions for the current fiscal year have significantly improved since the start of 2024, with a forecasted 14% year-over-year EPS growth.
Image Source: Zacks Investment Research
The Finishing Touch
Value investors perpetually hunt for opportunities, anticipating the broader market to eventually recognize discounted stocks, leading to substantial returns. Coupling this strategy with the Zacks Rank, which emphasizes earnings estimate revisions, facilitates the identification of undervalued stocks with substantial short-term upside potential.
All three stocks – JD.com, KB Home, and AllianceBernstein – may intrigue value-oriented investors, reinforced by their ‘A’ and ‘B’ Value Style Scores.