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Is The Cheesecake Factory (CAKE) Stock Undervalued Right Now?
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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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company to watch right now is The Cheesecake Factory (CAKE - Free Report) . CAKE is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 11.01, while its industry has an average P/E of 21.18. Over the past year, CAKE's Forward P/E has been as high as 13.36 and as low as 9.22, with a median of 11.15.
We also note that CAKE holds a PEG ratio of 1.03. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. CAKE's PEG compares to its industry's average PEG of 1.43. Over the last 12 months, CAKE's PEG has been as high as 2.46 and as low as 0.46, with a median of 1.06.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CAKE has a P/S ratio of 0.54. This compares to its industry's average P/S of 0.84.
Finally, we should also recognize that CAKE has a P/CF ratio of 8.93. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. CAKE's P/CF compares to its industry's average P/CF of 18.44. CAKE's P/CF has been as high as 11.52 and as low as 7.78, with a median of 8.95, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that The Cheesecake Factory is likely undervalued currently. And when considering the strength of its earnings outlook, CAKE sticks out at as one of the market's strongest value stocks.
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Is The Cheesecake Factory (CAKE) Stock Undervalued Right Now?
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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company to watch right now is The Cheesecake Factory (CAKE - Free Report) . CAKE is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 11.01, while its industry has an average P/E of 21.18. Over the past year, CAKE's Forward P/E has been as high as 13.36 and as low as 9.22, with a median of 11.15.
We also note that CAKE holds a PEG ratio of 1.03. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. CAKE's PEG compares to its industry's average PEG of 1.43. Over the last 12 months, CAKE's PEG has been as high as 2.46 and as low as 0.46, with a median of 1.06.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CAKE has a P/S ratio of 0.54. This compares to its industry's average P/S of 0.84.
Finally, we should also recognize that CAKE has a P/CF ratio of 8.93. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. CAKE's P/CF compares to its industry's average P/CF of 18.44. CAKE's P/CF has been as high as 11.52 and as low as 7.78, with a median of 8.95, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that The Cheesecake Factory is likely undervalued currently. And when considering the strength of its earnings outlook, CAKE sticks out at as one of the market's strongest value stocks.