Is Sportsman's Warehouse (SPWH) Stock Undervalued Right Now?
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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
Sportsman's Warehouse (SPWH) is a stock many investors are watching right now. SPWH is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 6.58. This compares to its industry's average Forward P/E of 10.68. SPWH's Forward P/E has been as high as 11.95 and as low as 5.84, with a median of 7.59, all within the past year.
We should also highlight that SPWH has a P/B ratio of 1.42. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. SPWH's current P/B looks attractive when compared to its industry's average P/B of 2.59. Over the past 12 months, SPWH's P/B has been as high as 3.25 and as low as 1.22, with a median of 1.51.
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. SPWH has a P/S ratio of 0.24. This compares to its industry's average P/S of 0.41.
Finally, investors should note that SPWH has a P/CF ratio of 3. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 5.96. Over the past 52 weeks, SPWH's P/CF has been as high as 7.54 and as low as 2.64, with a median of 3.50.
Urban Outfitters (URBN) may be another strong Retail - Apparel and Shoes stock to add to your shortlist. URBN is a # 2 (Buy) stock with a Value grade of A.
Urban Outfitters is trading at a forward earnings multiple of 11.96 at the moment, with a PEG ratio of 0.66. This compares to its industry's average P/E of 10.68 and average PEG ratio of 0.69.
URBN's Forward P/E has been as high as 12.39 and as low as 5.92, with a median of 9.18. During the same time period, its PEG ratio has been as high as 0.69, as low as 0.33, with a median of 0.51.
Additionally, Urban Outfitters has a P/B ratio of 1.30 while its industry's price-to-book ratio sits at 2.59. For URBN, this valuation metric has been as high as 2.12, as low as 1.01, with a median of 1.36 over the past year.
These are only a few of the key metrics included in Sportsman's Warehouse and Urban Outfitters strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, SPWH and URBN look like an impressive value stock at the moment.
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Sportsman's Warehouse Holdings, Inc. (SPWH) : Free Stock Analysis Report
Urban Outfitters, Inc. (URBN) : Free Stock Analysis Report
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