Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
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 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 stock to keep an eye on is BJ's Restaurants (BJRI). BJRI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 18.45, which compares to its industry's average of 25. BJRI's Forward P/E has been as high as 28.43 and as low as 16.91, with a median of 23.58, all within the past year.
Investors should also note that BJRI holds a PEG ratio of 1.32. 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. BJRI's PEG compares to its industry's average PEG of 1.79. BJRI's PEG has been as high as 2.03 and as low as 1.21, with a median of 1.68, all within the past year.
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. BJRI has a P/S ratio of 0.53. This compares to its industry's average P/S of 0.67.
Finally, our model also underscores that BJRI has a P/CF ratio of 8.27. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 22.22. Within the past 12 months, BJRI's P/CF has been as high as 9.82 and as low as 6.58, with a median of 8.46.
These are just a handful of the figures considered in BJ's Restaurants'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 BJRI is an impressive value stock right now.
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BJ's Restaurants, Inc. (BJRI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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