Should Value Investors Buy Noodles & Company (NDLS) Stock?
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.
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.
Noodles & Company (NDLS) is a stock many investors are watching right now. NDLS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
We also note that NDLS holds a PEG ratio of 1.33. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NDLS's industry currently sports an average PEG of 1.49. Over the past 52 weeks, NDLS's PEG has been as high as 1.66 and as low as 1.27, with a median of 1.37.
Finally, investors should note that NDLS has a P/CF ratio of 4.27. 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. NDLS's current P/CF looks attractive when compared to its industry's average P/CF of 16.38. Over the past year, NDLS's P/CF has been as high as 19.91 and as low as 4.27, with a median of 8.96.
Potbelly (PBPB) may be another strong Retail - Restaurants stock to add to your shortlist. PBPB is a # 2 (Buy) stock with a Value grade of A.
Additionally, Potbelly has a P/B ratio of 35.79 while its industry's price-to-book ratio sits at -23.65. For PBPB, this valuation metric has been as high as 184.47, as low as 29.92, with a median of 52.05 over the past year.
These are just a handful of the figures considered in Noodles & Company and Potbelly'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 NDLS and PBPB is an impressive value stock right now.
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Noodles & Company (NDLS) : Free Stock Analysis Report
Potbelly Corporation (PBPB) : Free Stock Analysis Report
