Should Value Investors Buy Lincoln Educational Services (LINC) Stock?

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 Lincoln Educational Services (LINC). LINC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Another valuation metric that we should highlight is LINC's P/B ratio of 1.22. 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. This stock's P/B looks attractive against its industry's average P/B of 1.46. Within the past 52 weeks, LINC's P/B has been as high as 2.30 and as low as 1.22, with a median of 1.82.

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. LINC has a P/S ratio of 0.43. This compares to its industry's average P/S of 0.87.

If you're looking for another solid Schools value stock, take a look at TAL Education Group (TAL). TAL is a # 2 (Buy) stock with a Value score of A.

Shares of TAL Education Group are currently trading at a forward earnings multiple of -17.35 and a PEG ratio of 0.13 compared to its industry's P/E and PEG ratios of 40.45 and 2.68, respectively.

Over the past year, TAL's P/E has been as high as 82.66, as low as -17.99, with a median of 5.31; its PEG ratio has been as high as 2.50, as low as 0.13, with a median of 0.80 during the same time period.

Furthermore, TAL Education Group holds a P/B ratio of 0.55 and its industry's price-to-book ratio is 1.46. TAL's P/B has been as high as 6.95, as low as 0.28, with a median of 0.68 over the past 12 months.

These are just a handful of the figures considered in Lincoln Educational Services and TAL Education Group's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that LINC and TAL is an impressive value stock right now.

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Lincoln Educational Services Corporation (LINC) : Free Stock Analysis Report
 
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