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Are Investors Undervaluing Insight Enterprises (NSIT) Right Now?

Zacks

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, 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 stock to keep an eye on is Insight Enterprises (NSIT). NSIT is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 11.10. This compares to its industry’s average Forward P/E of 15.46. NSIT’s Forward P/E has been as high as 12.16 and as low as 8.40, with a median of 10.98, all within the past year.


We should also highlight that NSIT has a P/B ratio of 1.91. The P/B is a method of comparing a stock’s market value to 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 2.47. Over the past year, NSIT’s P/B has been as high as 2.20 and as low as 1.43, with a median of 1.95.

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 prefered metric because revenue can’t really be manipulated, so sales are often a truer performance indicator. NSIT has a P/S ratio of 0.28. This compares to its industry’s average P/S of 0.29.

Finally, our model also underscores that NSIT has a P/CF ratio of 9.53. 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. This company’s current P/CF looks solid when compared to its industry’s average P/CF of 13.21. Over the past year, NSIT’s P/CF has been as high as 12.55 and as low as 7.11, with a median of 10.21.

These are only a few of the key metrics included in Insight Enterprises’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, NSIT looks like an impressive value stock at the moment.


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Zacks Investment Research
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