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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 company to watch right now is Pampa Energia (PAM). PAM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 10.24, which compares to its industry's average of 14.53. Over the last 12 months, PAM's Forward P/E has been as high as 12.13 and as low as 5.52, with a median of 7.41.

We should also highlight that PAM has a P/B ratio of 1.29. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.27. Over the past year, PAM's P/B has been as high as 1.57 and as low as 0.76, with a median of 1.05.

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. PAM has a P/S ratio of 2.17. This compares to its industry's average P/S of 2.28.

Finally, investors should note that PAM has a P/CF ratio of 4.39. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 10.64. Over the past year, PAM's P/CF has been as high as 7.29 and as low as 3.22, with a median of 4.53.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Pampa Energia is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PAM feels like a great value stock at the moment.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Pampa Energia S.A. (PAM) : Free Stock Analysis Report

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

Zacks Investment Research