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Are Investors Undervaluing Arcos Dorados (ARCO) Right Now?
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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 stock to keep an eye on is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.87. This compares to its industry's average Forward P/E of 24.60. Over the past 52 weeks, ARCO's Forward P/E has been as high as 276.72 and as low as 13.05, with a median of 18.30.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. 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 1.31.
Finally, our model also underscores that ARCO has a P/CF ratio of 6.87. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. ARCO's current P/CF looks attractive when compared to its industry's average P/CF of 17.43. ARCO's P/CF has been as high as 13.50 and as low as 5.73, with a median of 7.37, all within the past year.
Investors could also keep in mind Ruth's Hospitality Group , an Retail - Restaurants stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Ruth's Hospitality Group is currently trading with a Forward P/E ratio of 12.15 while its PEG ratio sits at 0.73. Both of the company's metrics compare favorably to its industry's average P/E of 24.60 and average PEG ratio of 2.08.
RUTH's Forward P/E has been as high as 19.50 and as low as 10.44, with a median of 14.11. During the same time period, its PEG ratio has been as high as 1.30, as low as 0.73, with a median of 0.96.
Ruth's Hospitality Group sports a P/B ratio of 4.58 as well; this compares to its industry's price-to-book ratio of -19.58. In the past 52 weeks, RUTH's P/B has been as high as 6.30, as low as 3.73, with a median of 4.97.
These are only a few of the key metrics included in Arcos Dorados and Ruth's Hospitality Group strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, ARCO and RUTH look like an impressive value stock at the moment.
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Are Investors Undervaluing Arcos Dorados (ARCO) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 stock to keep an eye on is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.87. This compares to its industry's average Forward P/E of 24.60. Over the past 52 weeks, ARCO's Forward P/E has been as high as 276.72 and as low as 13.05, with a median of 18.30.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. 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 1.31.
Finally, our model also underscores that ARCO has a P/CF ratio of 6.87. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. ARCO's current P/CF looks attractive when compared to its industry's average P/CF of 17.43. ARCO's P/CF has been as high as 13.50 and as low as 5.73, with a median of 7.37, all within the past year.
Investors could also keep in mind Ruth's Hospitality Group , an Retail - Restaurants stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Ruth's Hospitality Group is currently trading with a Forward P/E ratio of 12.15 while its PEG ratio sits at 0.73. Both of the company's metrics compare favorably to its industry's average P/E of 24.60 and average PEG ratio of 2.08.
RUTH's Forward P/E has been as high as 19.50 and as low as 10.44, with a median of 14.11. During the same time period, its PEG ratio has been as high as 1.30, as low as 0.73, with a median of 0.96.
Ruth's Hospitality Group sports a P/B ratio of 4.58 as well; this compares to its industry's price-to-book ratio of -19.58. In the past 52 weeks, RUTH's P/B has been as high as 6.30, as low as 3.73, with a median of 4.97.
These are only a few of the key metrics included in Arcos Dorados and Ruth's Hospitality Group strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, ARCO and RUTH look like an impressive value stock at the moment.