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So, what makes OFS such a great pick for value investors? 🤔 Well, let's start with the Price to Earnings Ratio (PE Ratio for short). 📊 This is a key metric that investors always keep an eye on, and for good reason! 💡 It shows how much investors are willing to pay for each dollar of earnings in a given stock. 💸 And guess what? OFS Capital's PE ratio is looking pretty darn good right now! 😍 With a trailing twelve months PE ratio of 6.96, OFS is actually below the market average (S&P 500) of 21.38. �
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Is OFS Capital (OFS) a Great Stock for Value Investors?
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, OFS Capital has a trailing twelve months PE ratio of 6.96, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 21.38. If we focus on the long-term PE trend, OFS Capital's current PE level puts it below its midpoint (which is 7.93) over the past five years. Moreover, the current level stands well below the highs for the stock, suggesting that it can be a solid entry point.
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