BJRI or PTLO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Retail - Restaurants sector might want to consider either BJ's Restaurants (BJRI) or Portillo's Inc. (PTLO). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, BJ's Restaurants has a Zacks Rank of #2 (Buy), while Portillo's Inc. has a Zacks Rank of #3 (Hold). This means that BJRI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
BJRI currently has a forward P/E ratio of 27.14, while PTLO has a forward P/E of 60.29. We also note that BJRI has a PEG ratio of 1.81. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PTLO currently has a PEG ratio of 8.18.
Another notable valuation metric for BJRI is its P/B ratio of 1.55. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, PTLO has a P/B of 1.85.
Based on these metrics and many more, BJRI holds a Value grade of B, while PTLO has a Value grade of C.
BJRI stands above PTLO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BJRI is the superior value option right now.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
BJ's Restaurants, Inc. (BJRI) : Free Stock Analysis Report
Portillo's Inc. (PTLO) : Free Stock Analysis Report
