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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Accel Entertainment (ACEL). ACEL is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock holds a P/E ratio of 14.22, while its industry has an average P/E of 23.92. ACEL's Forward P/E has been as high as 17.76 and as low as 11.88, with a median of 14.32, all within the past year.
We should also highlight that ACEL has a P/B ratio of 3.59. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. ACEL's current P/B looks attractive when compared to its industry's average P/B of 9.73. Over the past 12 months, ACEL's P/B has been as high as 4.92 and as low as 3.14, with a median of 3.81.
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. ACEL has a P/S ratio of 0.76. This compares to its industry's average P/S of 1.42.
Finally, we should also recognize that ACEL has a P/CF ratio of 8.80. 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 25.49. Within the past 12 months, ACEL's P/CF has been as high as 11.23 and as low as 7.35, with a median of 8.96.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Accel Entertainment is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ACEL feels like a great value stock at the moment.
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Accel Entertainment, Inc. (ACEL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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