Yahoo Finance Are Investors Undervaluing Tactile Systems Technology (TCMD) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Tactile Systems Technology (TCMD). TCMD is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 21.06 right now. For comparison, its industry sports an average P/E of 33.33. TCMD's Forward P/E has been as high as 381.08 and as low as 13.86, with a median of 34.16, all within the past year.
Another valuation metric that we should highlight is TCMD's P/B ratio of 1.74. 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. TCMD's current P/B looks attractive when compared to its industry's average P/B of 4.36. Within the past 52 weeks, TCMD's P/B has been as high as 3.75 and as low as 1.28, with a median of 1.90.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TCMD has a P/S ratio of 1.24. This compares to its industry's average P/S of 3.25.
Finally, investors should note that TCMD has a P/CF ratio of 9.62. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. TCMD's P/CF compares to its industry's average P/CF of 26.83. TCMD's P/CF has been as high as 240.14 and as low as 7.55, with a median of 10.72, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Tactile Systems Technology is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TCMD feels like a great value stock at the moment.
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Tactile Systems Technology, Inc. (TCMD) : Free Stock Analysis Report
