Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 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.

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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3 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 3 undervalued stocks in the Business Support Services industry for Monday, June 03, 2024. 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.

Aeries Technology Inc’s Value Grade

Value Grade:

Aeries Technology, Inc. is a global professional and management services company. The Company is engaged in offering a range of management consultancy services for private equity sponsors and their portfolio companies with engagement models. Its management consultancy services involves professional advisory services and operations management services to build and manage dedicated delivery centers in appropriate locations based on customer business needs. Its Advisory service to customers involves active participation of senior leadership recommending strategies, best practices as it relates to operating model design, right approach, consultation on various areas, market availability for resources with appropriate skillsets required for specific roles contemplated in the service model, regulations to be complied with, and optimization of tax structure.

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.

Aeries Technology Inc has a Value Score of 75, which is considered to be undervalued.

When you look at Aeries Technology Inc’s price-to-sales ratio at 0.32 compared to the industry median at 1.40, this company has a lower price relative to revenue compared to its peers. This could make Aeries Technology Inc’s stock more attractive for value investors.

Now, let’s assess Aeries Technology Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 9.4, when compared to the industry median of 11.7, 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. Aeries Technology Inc’s shareholder yield is the same than its industry median ratio of 0.00%. 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.

Herc Holdings Inc’s Value Grade

Value Grade:

Herc Holdings Inc. is an equipment rental supplier. The Company offers a portfolio of equipment for rent. In addition to its principal business of equipment rental, the Company sells used equipment and contractor supplies such as construction consumables, tools, small equipment and safety supplies; provides repair, maintenance, equipment management services and safety training to certain of its customers; offers equipment re-rental services and provides on-site support to its customers, and provides ancillary services such as equipment transport, rental protection, cleaning, refueling and labor. Its fleet includes aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction and lighting. Its ProContractor business focuses on professional-grade tools and equipment, and offers industry-specific solutions-based services, which include power generation, climate control, remediation and restoration, pumps, trench shoring, studio and production equipment.

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.

Herc Holdings Inc has a Value Score of 79, which is considered to be undervalued.

Herc Holdings Inc’s price-earnings ratio is 12.0 compared to the industry median at 23.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Herc Holdings Inc more attractive for value investors.

Herc Holdings Inc’s price-to-book ratio is lower than its peers. This could make Herc Holdings Inc more attractive for value investors when compared to the industry median at 2.74.

You can read more about Herc Holdings 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.

Onemednet Corp’s Value Grade

Value Grade:

OneMedNet Corporation is a curator of regulatory-grade Imaging Real World Data (RWD), through its OneMedNet iRWD solution. The Company provides solutions that unlock the significant value contained within the clinical image archives of healthcare providers. It de-identifies, searches, and curates a data archive locally, bringing a wealth of internal and third-party research opportunities to providers. By leveraging this extensive federated provider network, together with technology and in-house clinical expertise, the Company meets the rigorous RWD life science requirements. OneMedNet iRWD offers advanced technology, clinical expert curation, and service. Medical imaging and associated clinical data are indexed at each network site using artificial intelligence (AI)/ machine learning (ML) technology. This includes EHR, radiology, cardiology, lab, path, and others. In addition to its customized data packages, it also offers regulatory-grade, pre-packaged imaging RWD sets.

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.

Onemednet Corp has a Value Score of 64, which is considered to be undervalued.

You can read more about Onemednet 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 3 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.

• Aeries Technology Inc stock has a Value Grade of B.
• Herc Holdings Inc stock has a Value Grade of B.
• Onemednet Corp stock has a Value Grade of B.

Now that you have a bit more background about each of the 3 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.

• 3 Undervalued Business Support Services Stocks for Monday, June 03
• How to Boost Returns by Incorporating Momentum
• 6 Undervalued Business Support Services Stocks for Friday, May 31
• Why CRA International, Inc.’s (CRAI) Stock Is Up 4.13%

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.