Is Science Applications International (SAIC) Stock Undervalued 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Science Applications International (SAIC) is a stock many investors are watching right now. SAIC is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.01, while its industry has an average P/E of 18.79. Over the past year, SAIC's Forward P/E has been as high as 17.39 and as low as 10.50, with a median of 12.32.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. SAIC has a P/S ratio of 0.74. This compares to its industry's average P/S of 1.72.

These are only a few of the key metrics included in Science Applications International's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, SAIC looks like an impressive value stock at the moment.

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

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