Back to top

Image: Bigstock

Is BJ's Wholesale Club (BJ) a Great Value Stock Right Now?

Read MoreHide Full Article

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

BJ's Wholesale Club (BJ - Free Report) is a stock many investors are watching right now. BJ is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Investors should also note that BJ holds a PEG ratio of 1.01. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BJ's PEG compares to its industry's average PEG of 1.13. BJ's PEG has been as high as 1.91 and as low as 0.86, with a median of 1.15, all within the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. BJ has a P/S ratio of 0.39. This compares to its industry's average P/S of 1.15.

These are just a handful of the figures considered in BJ's Wholesale Club's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that BJ is an impressive value stock right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


BJ's Wholesale Club Holdings, Inc. (BJ) - free report >>

Published in