Should Value Investors Buy Host Hotels & Resorts (HST) Stock?

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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Host Hotels & Resorts (HST). HST is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 8.84 right now. For comparison, its industry sports an average P/E of 16.29. Over the last 12 months, HST's Forward P/E has been as high as 9.77 and as low as 6.79, with a median of 8.52.

Another valuation metric that we should highlight is HST's P/B ratio of 1.8. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. HST's current P/B looks attractive when compared to its industry's average P/B of 1.81. Over the past 12 months, HST's P/B has been as high as 1.99 and as low as 1.32, with a median of 1.73.

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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. HST has a P/S ratio of 2.51. This compares to its industry's average P/S of 4.

Finally, our model also underscores that HST has a P/CF ratio of 8.31. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. HST's current P/CF looks attractive when compared to its industry's average P/CF of 14.41. Over the past year, HST's P/CF has been as high as 9.04 and as low as 6.05, with a median of 7.87.

Value investors will likely look at more than just these metrics, but the above data helps show that Host Hotels & Resorts is likely undervalued currently. And when considering the strength of its earnings outlook, HST sticks out as one of the market's strongest value stocks.

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

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