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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is ADT (ADT). ADT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 9.14, while its industry has an average P/E of 14.47. Over the past year, ADT's Forward P/E has been as high as 10.52 and as low as 8.31, with a median of 9.27.

Another notable valuation metric for ADT is its P/B ratio of 1.82. 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 4.52. Over the past year, ADT's P/B has been as high as 1.92 and as low as 1.52, with a median of 1.74.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ADT has a P/S ratio of 1.39. This compares to its industry's average P/S of 2.2.

Finally, we should also recognize that ADT has a P/CF ratio of 3.97. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 9.79. Over the past year, ADT's P/CF has been as high as 4.19 and as low as 2.51, with a median of 3.24.

These are just a handful of the figures considered in ADT'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 ADT is an impressive value stock right now.

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

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