Back to top

Image: Bigstock

Should Value Investors Buy Burlington Stores (BURL) Stock?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Burlington Stores (BURL - Free Report) is a stock many investors are watching right now. BURL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We also note that BURL holds a PEG ratio of 1.23. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. BURL's PEG compares to its industry's average PEG of 3.09. Over the last 12 months, BURL's PEG has been as high as 1.31 and as low as 0.51, with a median of 1.03.

Finally, our model also underscores that BURL has a P/CF ratio of 22.36. 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 stock's P/CF looks attractive against its industry's average P/CF of 29.84. BURL's P/CF has been as high as 23.51 and as low as 13.05, with a median of 20.07, all within the past year.

These are just a handful of the figures considered in Burlington Stores'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 BURL is an impressive value stock right now.


See More Zacks Research for These Tickers


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


Burlington Stores, Inc. (BURL) - free report >>

Published in