Are Investors Undervaluing Summit Hotel Properties (INN) Right Now?
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.
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.
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 value investors might notice is Summit Hotel Properties (INN). INN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 7.17 right now. For comparison, its industry sports an average P/E of 14.95. Over the last 12 months, INN's Forward P/E has been as high as 9.71 and as low as 5.77, with a median of 7.21.
Finally, we should also recognize that INN has a P/CF ratio of 4.72. 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. INN's current P/CF looks attractive when compared to its industry's average P/CF of 14.55. INN's P/CF has been as high as 5.90 and as low as 3.75, with a median of 4.39, all within the past year.
Investors could also keep in mind Pebblebrook Hotel Trust (PEB), an REIT and Equity Trust - Other stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shares of Pebblebrook Hotel Trust are currently trading at a forward earnings multiple of 10.27 and a PEG ratio of 0.73 compared to its industry's P/E and PEG ratios of 14.95 and 2.26, respectively.
PEB's Forward P/E has been as high as 11.11 and as low as 7.19, with a median of 8.53. During the same time period, its PEG ratio has been as high as 0.79, as low as 0.51, with a median of 0.61.
Furthermore, Pebblebrook Hotel Trust holds a P/B ratio of 0.63 and its industry's price-to-book ratio is 1.69. PEB's P/B has been as high as 0.73, as low as 0.48, with a median of 0.58 over the past 12 months.
These are only a few of the key metrics included in Summit Hotel Properties and Pebblebrook Hotel Trust strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, INN and PEB look like an impressive value stock at the moment.
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Summit Hotel Properties, Inc. (INN) : Free Stock Analysis Report
Pebblebrook Hotel Trust (PEB) : Free Stock Analysis Report
