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Should Value Investors Buy Arcos Dorados (ARCO) Stock?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company to watch right now is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 14.85 right now. For comparison, its industry sports an average P/E of 21.57. Over the past 52 weeks, ARCO's Forward P/E has been as high as 276.72 and as low as 14.01, with a median of 19.43.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. ARCO has a P/S ratio of 0.51. This compares to its industry's average P/S of 1.06.
Finally, investors should note that ARCO has a P/CF ratio of 6.70. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.72. Within the past 12 months, ARCO's P/CF has been as high as 14.72 and as low as -267.80, with a median of 7.40.
Another great Retail - Restaurants stock you could consider is The ONE Group Hospitality (STKS - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
Additionally, The ONE Group Hospitality has a P/B ratio of 4.03 while its industry's price-to-book ratio sits at -17.82. For STKS, this valuation metric has been as high as 15.20, as low as 3.95, with a median of 6.89 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Arcos Dorados and The ONE Group Hospitality are likely undervalued currently. And when considering the strength of its earnings outlook, ARCO and STKS sticks out as one of the market's strongest value stocks.
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Should Value Investors Buy Arcos Dorados (ARCO) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company to watch right now is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 14.85 right now. For comparison, its industry sports an average P/E of 21.57. Over the past 52 weeks, ARCO's Forward P/E has been as high as 276.72 and as low as 14.01, with a median of 19.43.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. ARCO has a P/S ratio of 0.51. This compares to its industry's average P/S of 1.06.
Finally, investors should note that ARCO has a P/CF ratio of 6.70. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.72. Within the past 12 months, ARCO's P/CF has been as high as 14.72 and as low as -267.80, with a median of 7.40.
Another great Retail - Restaurants stock you could consider is The ONE Group Hospitality (STKS - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
Additionally, The ONE Group Hospitality has a P/B ratio of 4.03 while its industry's price-to-book ratio sits at -17.82. For STKS, this valuation metric has been as high as 15.20, as low as 3.95, with a median of 6.89 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Arcos Dorados and The ONE Group Hospitality are likely undervalued currently. And when considering the strength of its earnings outlook, ARCO and STKS sticks out as one of the market's strongest value stocks.