Interested in following smaller companies? Interested in gaining exposure to consumer companies? Do you prefer stocks that analysts rate as 'Buy'? Looking for undervalued stocks? Keeping this idea in mind, we ran a screen you might be interested in.
The Price/Sales ratio is a price-multiple valuation metric used to help identify if a firm is cheap by its twelve month trailing sales numbers. In the most basic terms, it let's an investor know how much the investment community is willing to pay for every dollar worth of sales. A firm with a P/S ratio of one or lower would be viewed as cheap because investors are paying $1 or less for every dollars worth of a firm's sales. On the other hand, a firm is generally considered to be expensive when the P/S ratio is above three. These are general guidelines used by the investment community not hard rules to be clear. Price/Sales Ratio = Current Stock Price/Revenue (sales) per Share
The forward P/E is a price multiple valuation metric, which is similar to the current P/E ratio, except that it uses the forecasted earnings instead. While this number might not be as accurate because it uses "forecasted" numbers, it does offer the benefit of illustrating analysts' expectations of a firm. If the market believes that earnings will grow moving forward, then the forward P/E should be lower than the current P/E. Financial Leverage, also known as the Equity Multiplier, illustrates how a firm is financing its assets. The lower the number the more a firm is financing its assets internally through stockholder equity. The higher this metric is the more the firm is relying on debt to finance its assets.
We first looked for small cap consumer stocks. We then looked for businesses that analysts rate as "Buy" (2 < mean recommendation < 3). From here, we then looked for companies that are trading at a discount (P/S<1)(forward P/E<10).
Do you think these small-cap stocks deserve to grow higher? Use this list as a starting-off point for your own analysis.
1) Boise Inc. (NYSE:BZ)
|Industry:||Paper & Paper Products|
Boise Inc. has a Analysts' Rating of 2.00 and Price/Sales Ratio of 0.29 and Forward Price/Earnings Ratio of 6.94. The short interest was 3.01% as of 05/21/2012. Boise Inc., together with its subsidiaries, engages in the manufacture and sale of packaging and paper products in the United States, Europe, Mexico, and Canada. The company's Paper segment offers communication-based papers that include imaging papers for the office and home use; and printing and converting papers used by commercial printers or converters to manufacture envelopes, forms, and other commercial paper products. This segment also provides packaging-demand-driven papers comprising label and release papers, such as label face stocks and release liners; flexible packaging papers consisting of coated and uncoated papers sold to customers for the creation of flexible packaging products for food and nonfood applications; corrugating medium, a raw material used in the manufacture of corrugated sheets and containers; and market pulp for manufacturing paper products.
2) ACCO Brands Corporation (ABD)
ACCO Brands Corporation has a Analysts' Rating of 1.80 and Price/Sales Ratio of 0.41 and Forward Price/Earnings Ratio of 8.03. The short interest was 10.25% as of 05/21/2012. ACCO Brands Corporation engages in the design, manufacture, marketing, and distribution of office products primarily in the United States, Australia, the United Kingdom, and Canada. The company provides traditional office products and supplies, including staplers, staples, punches, ring binders, trimmers, sheet protectors, hanging file folders, clips and fasteners, dry-erase boards, dry-erase markers, easels, bulletin boards, overhead projectors, transparencies, and laser pointers and screens under the Quartet, Rexel, Swingline, Wilson Jones, Marbig, NOBO, ACCO, Derwent, and Eastlight brads. It also offers document finishing solutions comprising binding, lamination and punching equipment, binding and lamination supplies, report covers, archival report covers, and shredders, as well as machine maintenance and repair services under the GBC brand name.
3) Dana Holding Corporation (NYSE:DAN)
Dana Holding Corporation has a Analysts' Rating of 1.90 and Price/Sales Ratio of 0.24 and Forward Price/Earnings Ratio of 5.55. The short interest was 8.84% as of 05/21/2012. Dana Holding Corporation engages in the design, manufacture, and supply of driveline products, technologies, and service parts for vehicle manufacturers worldwide. It provides light axles, driveshafts, structural products, sealing products, thermal products, and related service parts for light trucks, sport utility vehicles, crossover utility vehicles, vans, and passenger cars. The company also offers axles, driveshafts, chassis and side rails, ride controls and related modules and systems, engine sealing products, thermal products, and related service parts for medium- and heavy-duty trucks, buses, and other commercial vehicles.
4) Clearwater Paper Corporation (NYSE:CLW)
|Industry:||Paper & Paper Products|
Clearwater Paper Corporation has a Analysts' Rating of 2.00 and Price/Sales Ratio of 0.38 and Forward Price/Earnings Ratio of 9.54. The short interest was 2.93% as of 05/21/2012. Clearwater Paper Corporation manufactures and sells pulp-based products in the United States and internationally. The company operates in two segments, Consumer Products, and Pulp and Paperboard. The Consumer Products segment provides consumer private label tissue products, including bathroom tissue, household paper towels, napkins, and facial tissues.
5) Cooper Tire & Rubber Co. (NYSE:CTB)
|Industry:||Rubber & Plastics|
Cooper Tire & Rubber Co. has a Analysts' Rating of 1.80 and Price/Sales Ratio of 0.23 and Forward Price/Earnings Ratio of 6.09. The short interest was 3.56% as of 05/21/2012. Cooper Tire & Rubber Company, together with its subsidiaries, manufactures and markets replacement tires in North America and internationally. It operates in two segments, North American Tire Operations and International Tire Operations. The North American Tire Operations segment produces and distributes passenger car and light truck tires, as well as tires for racing, medium trucks, and motorcycles to independent tire dealers, wholesale distributors, regional and national retail tire chains, and other large automotive product retail chains. This segment sells its products through three own retail stores.
6) Blount International Inc. (NYSE:BLT)
|Industry:||Housewares & Accessories|
Blount International Inc. has a Analysts' Rating of 2.00 and Price/Sales Ratio of 0.74 and Forward Price/Earnings Ratio of 8.47. The short interest was 2.77% as of 05/21/2012. Blount International, Inc., together with its subsidiaries, designs, manufactures, and markets equipment, replacement and component parts, and accessories to forestry, lawn and garden, farm, ranch, agriculture, and construction sectors in the United States and internationally. It provides forestry products, including cutting chain, chain saw guide bars, and cutting chain drive sprockets used on portable gasoline and electric chain saws, and mechanical timber harvesting equipment; and purchases and markets small chain saw engine replacement parts, safety equipment and clothing, lubricants, maintenance tools, hand tools, and other accessories, as well as sells a line of cordless electric chain saws. The company also offers lawn and garden products comprising lawnmower and edger cutting blades for various machines and cutting conditions; and purchases and markets cutting line for line trimmers, air filters, spark plugs, lubricants, wheels, belts, grass bags, maintenance tools, hand tools, and accessories.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz and Google Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.