This Stock Is CRAZY CHEAP - what do you think?

When investors think about how cheap a stock is, they usually focus on the stock price.

But we can’t just look at the price to see if something is cheap or not.

For example, a half dozen eggs at $3.99 might be cheaper than a dozen eggs at $4.99.

Yes, the price is lower for the half-dozen eggs, but the value is better for the Dozen.

I think of stocks in the same way.

The most popular way to determine “cheapness” for stocks is using the price-to-earnings ratio.

It’s calculated by dividing a company’s stock price by its earnings per share.

But earnings fluctuate a lot, and the price-to-earnings ratio doesn’t work if a company is losing money.

Others prefer price-to-sales, which is more stable than price-to-earnings and never goes negative.

However, price-to-sales doesn’t take into account how a company manages its expenses.

Revenue doesn’t matter if a company is full of wasteful spending!

What’s my favorite? The price-to-book ratio.

Book value is a company’s assets (what the company owns) minus its liabilities (what the company owes others).

Price-to-book is calculated by dividing the price by a company’s book value per share.

Price-to-book is more stable than price-to-earnings and includes cumulative profits for a company, which price-to-sales ignores.

Right now, the price-to-book for Accenture (ticker: ACN) is screaming “cheap, cheap, CHEAP!”

With locations in over 50 countries, Accenture is one of the largest consulting and IT firms in the world.

Accenture’s price-to-book is currently at 5.6x, which is almost 40% lower than its historical average.

Accenture’s price-to-book ratio has never been lower!

What happened?

Accenture released earnings Friday morning, and the stock fell almost 7%.

Revenues and earnings per share increased by 6% and 15%, respectively, compared to the prior year.

Revenue and earnings growth look pretty good.

Company management even raised revenue growth expectations by a full percentage point for the remainder of 2025.

But what spooked investors was the 6% drop in new bookings.

New bookings are new contracts signed for future work from Accenture’s clients.

Booking new business is critical for Accenture to keep its high growth rate.

However, the drop is more of a blip rather than a worrying trend.

Businesses are facing uncertainty with tariffs and global tensions. They aren’t looking to sign multi-million dollar contracts with consulting firms like Accenture.

The recent uncertainty isn’t going to last forever.

Once businesses have a better handle on the future, they’ll start flocking back to Accenture.

And Accenture’s historically low price-to-book ratio won’t stay low for long.

Today is an amazing opportunity to buy into one of the world’s largest consulting firms!

What other deals are you seeing in today’s market?