Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn't want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value? One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let's put Wal-Mart Stores, Inc. WMT stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks: PE Ratio A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock's current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole. On this front, Wal-Mart has a trailing twelve months PE ratio of 18.20, as you can see in the chart below: <img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wmt1.jpg" style="width: 620px; height: 227px;" /> This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 20.35. If we focus on the long-term PE trend, Wal-Mart's current PE level puts it above its midpoint over the past five years with the number having risen rapidly in the past few months. <img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wmt2.jpg" style="width: 620px; height: 227px;" /> Further, the stock's PE also compares favorably with the Zacks classified Retail-Wholesale sector's trailing twelve months PE ratio, which stands at 27.21. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers. <img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wmt3.jpg" style="width: 620px; height: 227px;" /> We should also point out that Wal-Mart has a forward PE ratio (price relative to this year's earnings) of 18.18, so it is fair to say that a slightly more value-oriented path may be ahead for Wal-Mart stock in the near term too. P/S Ratio Another key metric to note is the Price/Sales ratio. This approach compares a given stock's price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings. Right now, Wal-Mart has a P/S ratio of about 0.49. This is significantly lower than the S&P 500 average, which comes in at 3.14 right now. Also, as we can see in the chart below, this is below the highs for this stock in particular over the past few years. <img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wmt4.jpg" style="width: 620px; height: 264px;" /> If anything, WMT is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading—at least compared to historical norms. Broad Value Outlook In aggregate, Wal-Mart currently has a Zacks Value Style Score of ‘A', putting it into the top 20% of all stocks we cover from this look. This makes Wal-Mart a solid choice for value investors. What About the Stock Overall? Though Wal-Mart might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘A' and a Momentum score of ‘B'. This gives WMT a Zacks VGM score—or its overarching fundamental grade—of ‘A'. (You can read more about the Zacks Style Scores <a href="https://www.zacks.com/style-scores-education/">here >></a>) Meanwhile, the company's recent earnings estimates have been mixed at best. The current fiscal quarter has seen four estimates go higher in the past sixty days compared to four lower, while the fiscal full year estimate has seen eight upward and two downward revisions in the same time period. As a result, the current fiscal quarter consensus estimate has remained stable in the past two months, while the fiscal full year estimate has inched up by 0.7%. You can see the consensus estimate trend and recent price action for the stock in the chart below:<div class="chart_embed">Wal-Mart Stores, Inc. Price and Consensus  <a href="https://www.zacks.com/stock/chart/WMT/price-consensus-chart"> <img alt="" src="https://staticx-tuner.zacks.com/images/charts/39/1497003543.png" title="" /> </a><a href="https://www.zacks.com/stock/chart/WMT/price-consensus-chart">Wal-Mart Stores, Inc. Price and Consensus</a> | <a href="https://www.zacks.com/stock/quote/WMT">Wal-Mart Stores, Inc. Quote</a></div>This somewhat mixed trend is why the stock has just a Zacks Rank #3 (Hold) and why we are looking for in-line performance from the company in the near term. Bottom Line Wal-Mart is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Furthermore, a robust industry rank (among the Top 35%) should boost investor confidence. However over the past one year, the Zacks Retail – Supermarkets industry has underperformed the broader market, as you can see below: <img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wmt6.jpg" style="width: 620px; height: 253px;" /> Despite the poor past performance of the industry, a good industry rank signals that the stock is likely to benefit from favorable broader factors in the immediate future. So, value investors might want to wait for estimates and analyst sentiment to turn around in this name first, but once that happens, this stock could be a compelling pick. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020. <a href="https://www.zacks.com/registration/ultimatetrader/welcome/eoffer/3627?adid=ZCOM_ZU_IoTReport_ANALYSTBLOG_IND_IOT_060917&icid=EOAC-AnalystBlog-tx-ZU060917">Click here for the 6 trades >></a> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. <a href="http://www.zacks.com/registration/pfp/?ALERT=RPT_7BST_LP194&ADID=BENZ_CONTENT_ZER_ARTCAT_ANALYST_BLOG&cid=CS-BENZ-FT-263749" target="_blank">Click to get this free report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&d_alert=ZER_LINK&t=WMT&ADID=BENZ_CONTENT_ZER_ARTCAT_ANALYST_BLOG&cid=CS-BENZ-FT-263749">Wal-Mart Stores, Inc. WMT: Free Stock Analysis Report</a>   <a href="http://www.zacks.com/stock/news/263749/should-value-investors-pick-wal-mart-wmt-stock-now?cid=CS-BENZ-FT-263749">To read this article on Zacks.com click here.</a>   <a href="http://www.zacks.com/">Zacks Investment Research</a>

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Should Value Investors Pick Wal-Mart (WMT) Stock Now?