Should Value Investors Buy PlayAGS (AGS) 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.
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.
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 company value investors might notice is PlayAGS (AGS). AGS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is AGS's P/B ratio of 4.49. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 8.57. Within the past 52 weeks, AGS's P/B has been as high as 5.98 and as low as 3.23, with a median of 4.25.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AGS has a P/S ratio of 0.82. This compares to its industry's average P/S of 1.28.
Another great Gaming stock you could consider is MGM Resorts International (MGM), which is a # 2 (Buy) stock with a Value Score of A.
MGM Resorts International is currently trading with a Forward P/E ratio of 13.96 while its PEG ratio sits at 8.41. Both of the company's metrics compare favorably to its industry's average P/E of 31.21 and average PEG ratio of 4.09.
MGM's Forward P/E has been as high as 270.61 and as low as 13.12, with a median of 27.87. During the same time period, its PEG ratio has been as high as 14.32, as low as 1.48, with a median of 7.86.
MGM Resorts International sports a P/B ratio of 2.67 as well; this compares to its industry's price-to-book ratio of 8.57. In the past 52 weeks, MGM's P/B has been as high as 3.83, as low as 2.07, with a median of 2.99.
These are just a handful of the figures considered in PlayAGS and MGM Resorts International'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 AGS and MGM is an impressive value stock right now.
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PlayAGS, Inc. (AGS) : Free Stock Analysis Report
MGM Resorts International (MGM) : Free Stock Analysis Report
