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 stock to keep an eye on is POSCO (PKX). PKX is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Investors will also notice that PKX has a PEG ratio of 0.30. 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. PKX's industry has an average PEG of 0.57 right now. Over the last 12 months, PKX's PEG has been as high as 2.55 and as low as 0.29, with a median of 0.40.

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. PKX has a P/S ratio of 0.27. This compares to its industry's average P/S of 0.35.

Finally, investors will want to recognize that PKX has a P/CF ratio of 4.40. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. PKX's current P/CF looks attractive when compared to its industry's average P/CF of 14.50. PKX's P/CF has been as high as 6.24 and as low as 2.83, with a median of 5, all within the past year.

SSAB (SSAAY) may be another strong Steel - Producers stock to add to your shortlist. SSAAY is a # 2 (Buy) stock with a Value grade of A.

SSAB sports a P/B ratio of 0.90 as well; this compares to its industry's price-to-book ratio of 1.42. In the past 52 weeks, SSAAY's P/B has been as high as 1.10, as low as 0.57, with a median of 0.80.

These are only a few of the key metrics included in POSCO and SSAB strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, PKX and SSAAY look like an impressive value stock at the moment.

Story Continues

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

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