The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
China Life (LFC) is a stock many investors are watching right now. LFC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Investors should also recognize that LFC has a P/B ratio of 1.10. 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. This stock's P/B looks solid versus its industry's average P/B of 1.32. LFC's P/B has been as high as 1.40 and as low as 0.81, with a median of 1.15, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. LFC has a P/S ratio of 0.58. This compares to its industry's average P/S of 0.59.
Value investors will likely look at more than just these metrics, but the above data helps show that China Life is likely undervalued currently. And when considering the strength of its earnings outlook, LFC sticks out at as one of the market's strongest value stocks.
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China Life Insurance Company Limited (LFC) : Free Stock Analysis Report
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