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Is Rush Enterprises (RUSHA) Stock Undervalued Right Now?

Zacks Equity Research
·2 mins read

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Rush Enterprises (RUSHA). RUSHA is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Investors should also note that RUSHA holds a PEG ratio of 1.34. 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. RUSHA's industry has an average PEG of 1.89 right now. Over the last 12 months, RUSHA's PEG has been as high as 1.89 and as low as 0.64, with a median of 0.88.

Finally, investors will want to recognize that RUSHA has a P/CF ratio of 6.42. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. RUSHA's current P/CF looks attractive when compared to its industry's average P/CF of 11.41. Over the past year, RUSHA's P/CF has been as high as 6.59 and as low as 3.32, with a median of 5.02.

Value investors will likely look at more than just these metrics, but the above data helps show that Rush Enterprises is likely undervalued currently. And when considering the strength of its earnings outlook, RUSHA sticks out at as one of the market's strongest value stocks.


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Zacks Investment Research