Are Investors Undervaluing Quest Resource (QRHC) Right Now?

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One stock to keep an eye on is Quest Resource (QRHC). QRHC is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 13.77 right now. For comparison, its industry sports an average P/E of 25.46. Over the last 12 months, QRHC's Forward P/E has been as high as 1,623.43 and as low as -185.71, with a median of 9.81.

QRHC is also sporting a PEG ratio of 1.53. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. QRHC's PEG compares to its industry's average PEG of 2.04. Over the last 12 months, QRHC's PEG has been as high as 108.23 and as low as -12.38, with a median of 0.60.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Quest Resource is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, QRHC feels like a great value stock at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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