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Is The ONE Group Hospitality (STKS) a Great Value Stock 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company to watch right now is The ONE Group Hospitality (STKS - Free Report) . STKS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 10.60, while its industry has an average P/E of 22.54. Over the last 12 months, STKS's Forward P/E has been as high as 30.03 and as low as 7.41, with a median of 10.83.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. STKS has a P/S ratio of 0.48. This compares to its industry's average P/S of 0.87.

Finally, we should also recognize that STKS has a P/CF ratio of 8.70. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 16.86. Within the past 12 months, STKS's P/CF has been as high as 10.98 and as low as 5.19, with a median of 8.86.

Value investors will likely look at more than just these metrics, but the above data helps show that The ONE Group Hospitality is likely undervalued currently. And when considering the strength of its earnings outlook, STKS sticks out at as one of the market's strongest value stocks.


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