Should Value Investors Buy Cracker Barrel Old Country Store (CBRL) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 Cracker Barrel Old Country Store (CBRL). CBRL is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.46, which compares to its industry's average of 23.34. Over the last 12 months, CBRL's Forward P/E has been as high as 18.31 and as low as 12.19, with a median of 15.75.
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. CBRL has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.96.
Finally, investors should note that CBRL has a P/CF ratio of 8.63. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 18.04. CBRL's P/CF has been as high as 12.11 and as low as 8.27, with a median of 10.11, all within the past year.
Investors could also keep in mind El Pollo Loco (LOCO), an Retail - Restaurants stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Furthermore, El Pollo Loco holds a P/B ratio of 1.22 and its industry's price-to-book ratio is -24.14. LOCO's P/B has been as high as 1.69, as low as 0.95, with a median of 1.22 over the past 12 months.
These are just a handful of the figures considered in Cracker Barrel Old Country Store and El Pollo Loco's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that CBRL and LOCO is an impressive value stock right now.
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Cracker Barrel Old Country Store, Inc. (CBRL) : Free Stock Analysis Report
El Pollo Loco Holdings, Inc. (LOCO) : Free Stock Analysis Report
