Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Business Support Services industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Latest Business Support Services Stock News

Before choosing which top Business Support Services stock to buy, be sure to conduct proper due diligence: analyze various financial metrics and look at historical data, public statements and news coverage.

The fundamental outlook for the business support services industry is neutral. Participants across the sub-industry carry out a wide scope of applications, including payments for goods and services, human resource (HR) payroll processing, and outsourcing. A variety of factors including inflation, pandemic-related impacts and geopolitical tensions have created a difficult set of obstacles for companies to maneuver. However, companies have largely recovered from pandemic-related impacts. Companies overly exposed to consumer groups have experienced larger inflationary pressures. Contractionary measures such as the Federal Reserve continuing to raise interest rates could further dampen consumer spending. It will be important that no other exogenous events emerge, such as intensified geopolitical conflicts disrupting the ongoing recovery in TPV (third party verification), employment levels, etc. Underlying payment economics likely flip to tailwinds as value-added services (VAS) revenue lines help fill the void and provide a “cushion” for upside, especially if other verticals or regions temporarily relax in the interim.

Why Focus on Undervalued Business Support Services Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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6 Undervalued Business Support Services Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Business Support Services industry for Wednesday, November 22, 2023. Let’s take a closer look at their individual scores to see how they measure up against each other and the Business Support Services industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

ABM Industries Inc’s Value Grade

Value Grade:

ABM Industries Incorporated is a provider of integrated facility, infrastructure, and mobility solutions. Its segments include Business & Industry (B&I;), Manufacturing & Distribution (M&D;), Education, Aviation, and Technical Solutions. B&I; segment includes janitorial, facilities engineering, and parking services for commercial real estate properties, sports and entertainment venues, and non-acute healthcare facilities. M&D; segment provides facility services, engineering, janitorial, and other specialized services in manufacturing and distribution. Education segment delivers custodial, landscaping and grounds, facilities engineering, and parking services for public school districts, private schools, colleges, and universities. Aviation segment supports airlines and airports with services ranging from parking and janitorial to passenger assistance, catering logistics, air cabin maintenance and transportation. Technical Solutions segment includes mechanical and electrical services.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

ABM Industries Inc has a Value Score of 68, which is considered to be undervalued.

When you look at ABM Industries Inc’s price-to-sales ratio at 0.34 compared to the industry median at 1.60, this company has a lower price relative to revenue compared to its peers. This could make ABM Industries Inc’s stock more attractive for value investors.

ABM Industries Inc’s price-earnings ratio is 11.51 compared to the industry median at 23.70. This means it has a lower share price relative to earnings compared to its peers. This could make ABM Industries Inc more attractive for value investors.

Now, let’s assess ABM Industries Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 8.5, when compared to the industry median of 11.0, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. ABM Industries Inc’s shareholder yield is higher than its industry median ratio of (0.01%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. ABM Industries Inc’s price-to-book ratio is lower than its industry median ratio of 2.43. This could make ABM Industries Inc more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at ABM Industries Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. ABM Industries Inc’s price-to-free-cash-flow ratio is higher than its industry median ratio of 14.67. This could make ABM Industries Inc less attractive because the higher P/FCF ratio indicates that ABM Industries Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Corecivic Inc’s Value Grade

Value Grade:

CoreCivic, Inc. is a diversified, government-solutions company. The Company provides a broad range of solutions to government partners that serve the public good through corrections and detention management. Its segments include CoreCivic Safety, CoreCivic Community, and CoreCivic Properties. CoreCivic Safety segment consists of the correctional and detention facilities that are owned, or controlled via a long-term lease, and managed by CoreCivic, as well as those correctional and detention facilities owned by third parties but managed by CoreCivic. CoreCivic Safety also includes the operating results of its subsidiary that provides transportation services to governmental agencies, TransCor America, LLC. CoreCivic Community segment consists of the residential reentry centers that are owned, or controlled via a long-term lease, and managed by CoreCivic. CoreCivic Properties segment consists of the real estate properties owned by CoreCivic and leased to government agencies.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Corecivic Inc has a Value Score of 71, which is considered to be undervalued.

Corecivic Inc’s price-earnings ratio is 23.8 compared to the industry median at 23.7. This means that it has a higher price relative to its earnings compared to its peers. This makes Corecivic Inc less attractive for value investors.

Corecivic Inc’s price-to-book ratio is higher than its peers. This could make Corecivic Inc less attractive for value investors when compared to the industry median at 2.43.

You can read more about Corecivic Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

International Money Express Inc’s Value Grade

Value Grade:

International Money Express, Inc. is an omnichannel money remittance services company. The Company is focused primarily on the United States of America to Latin America and the Caribbean (LAC) corridor, which includes Mexico, Central, and South America and the Caribbean. Its remittance services include a comprehensive suite of ancillary financial processing solutions and payment services available in all 50 states in the United States, Washington D.C., Puerto Rico and 13 provinces in Canada. It offers money remittance services to LAC countries, mainly Mexico and Guatemala. These services involve the movement of funds on behalf of an originating consumer for receipt by a designated beneficiary at a designated receiving location. The money remittance services enable consumers to send funds through its network of locations in the United States and Canada that are primarily operated by third-party businesses, as well as through its Company-operated stores located in the United States.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

International Money Express Inc has a Value Score of 67, which is considered to be undervalued.

International Money Express Inc’s price-earnings ratio is 14.3 compared to the industry median at 23.7. This means that it has a lower price relative to its earnings compared to its peers. This makes International Money Express Inc more attractive for value investors.

International Money Express Inc’s price-to-book ratio is lower than its peers. This could make International Money Express Inc more attractive for value investors when compared to the industry median at 2.43.

You can read more about International Money Express Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

36Kr Holdings Inc - ADR’s Value Grade

Value Grade:

36Kr Holdings Inc. is a company that provides clients with new economy-focused business services, including online advertising services, enterprise value-added services and subscription services. The Company provides reports on companies, market updates, editorials and commentaries, and introduces some startup companies to the investment community. The Company offer services either through agencies or directly to the end customers. The Company operates its businesses primarily in the domestic market.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

36Kr Holdings Inc - ADR has a Value Score of 74, which is considered to be undervalued.

36Kr Holdings Inc - ADR’s price-to-book ratio is higher than its peers. This could make 36Kr Holdings Inc - ADR less attractive for value investors when compared to the industry median at 2.43.

You can read more about 36Kr Holdings Inc - ADR’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Team Inc’s Value Grade

Value Grade:

Team, Inc. is a provider of specialty industrial services offering clients access to a full suite of conventional, specialized, and proprietary mechanical, heat-treating, and inspection services. It operates in two segments: Inspection and Heat Treating (IHT) and Mechanical Services (MS). The IHT segment offers specialty inspection services as well as heat-treating services and digital imaging services. It offers various IHT services, such as non-destructive evaluation and testing services, radiographic testing, ultrasonic testing, magnetic particle inspection, liquid penetrant inspection, positive material identification, electromagnetic testing, alternating current field measurement, phased array ultrasonic testing, terminals and storage inspection and management programs, and rope access. The MS segment provides onstream services, such as leak repair services, engineered composite repair, emissions control/compliance services, hot tapping services, and field machining services.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Team Inc has a Value Score of 87, which is considered to be undervalued.

Team Inc’s price-to-book ratio is higher than its peers. This could make Team Inc less attractive for value investors when compared to the industry median at 2.43.

You can read more about Team Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Scworx Corp’s Value Grade

Value Grade:

SCWorx Corp. is a provider of data content and services related to the repair, normalization and interoperability of information for healthcare providers, as well as big data analytics. for the healthcare industry. The Company is engaged in developing and marketing health care information technology solutions and associated services that improve healthcare processes and information flow within hospitals and other healthcare facilities. Its software enables a healthcare provider to simplify and organize its data; allows the data to be utilized across multiple internal software applications and provides the basis for sophisticated data analytics. Its software solution modules include virtualized item master file repair, expansion, and automation; electronic medical record management; charge description master (CDM) management; contract management; request for proposal (RFP) automation; rebate management; big data analytics modeling, and data integration and warehousing.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Scworx Corp has a Value Score of 66, which is considered to be undervalued.

Scworx Corp’s price-to-book ratio is higher than its peers. This could make Scworx Corp less attractive for value investors when compared to the industry median at 2.43.

You can read more about Scworx Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Business Support Services Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Business Support Services stocks as well as other industrys.

Choosing Which of the 6 Best Business Support Services Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• ABM Industries Inc stock has a Value Grade of B.
• Corecivic Inc stock has a Value Grade of B.
• International Money Express Inc stock has a Value Grade of B.
• 36Kr Holdings Inc - ADR stock has a Value Grade of B.
• Team Inc stock has a Value Grade of A.
• Scworx Corp stock has a Value Grade of B.

Now that you have a bit more background about each of the 6 undervalued stocks in the Business Support Services industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Business Support Services Stocks

Want to learn more about Business Support Services stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 6 Undervalued Business Support Services Stocks for Wednesday, November 22
• Which Is a Better Investment, AvidXchange Holdings Inc or Euronet Worldwide Inc Stock?
• Which Is a Better Investment, AvidXchange Holdings Inc or Flywire Corp Stock?
• Which Is a Better Investment, AvidXchange Holdings Inc or Nuvei Corp Stock?

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.