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3 Highly Ranked Stocks That Won't Break Your Piggybank
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Investors are always looking for stocks that won’t break the bank and have fundamental value to support their “bargain” propositions. This is especially true with markets ripping higher over the last year but several top-rated Zacks stocks still stand out in terms of their affordability and value.
Even better, a few of these names have encouraging growth prospects as well which strengthens the narrative that their stocks should appreciate. Benefiting from strong business industries these companies also appear to be in a good position to take market share.
Furthermore, the risk to reward looks very favorable as these stocks currently boast a Zacks Rank #1 (Strong Buy). In addition to their strong buy rating, they also have an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
Hailing from the Zacks Retail and Wholesale sector and the Zacks Consumer Discretionary sector let’s take a look at these affordable and promising stocks.
Quietly, Arcos Dorados has been one of the better-performing stocks over the last year up +41% but still 8% from its 52-week highs of $13 a share seen in late December.
As the largest franchisee of McDonald’s (MCD - Free Report) restaurants in the world, the dip looks attractive as Arcos operates the classic burger chains throughout Latin America. Arcos has over 2,000 McDonald’s branded restaurants with a presence in many South American countries including Brazil along with locations throughout the Caribbean and Mexico.
Trading at 12.7X forward earnings, Arcos is expected to round out its fiscal 2023 with EPS up 19% to $0.82 a share compared to $0.69 a share in 2022. Plus, FY24 earnings are projected to rise another 15% to $0.95 a share. More importantly, earnings estimate revisions have remained higher over the last 60 days for both FY23 and FY24.
Image Source: Zacks Investment Research
Arcos also has a price-to-sales ratio (P/S) of just 0.61X with double-digit top line growth forecasted as well. Notably, total sales are now expected to jump 19% in FY23 and rise another 10% in FY24 to $4.75 billion.
Image Source: Zacks Investment Research
Carrols Restaurant Group
Burger King’s largest franchisee in Carrols Restaurant Group also looks attractive with the trend of earnings estimate revisions very compelling over the last 60 days. Carrols operates nearly 1,000 Burger King restaurants throughout the United States and over 60 Popeyes restaurants.
Interestingly enough, Carrols' stock was one of the best performers in 2023 skyrocketing over 300% in the last year to current levles of around $8 a share.
Image Source: Zacks Investment Research
Rounding out its FY23, earnings estimates are up 16% in the last two months while FY24 EPS estimates have soared 24%. More intriguing, annual earnings are expected to climb swing to $0.49 a share versus an adjusted loss of -$0.70 a share in 2022. Fiscal 2024 earnings are forecasted to rise another 14% to $0.56 a share and Carrols' stock still trades at a reasonable 14.7X forward earnings multiple.
Image Source: Zacks Investment Research
Trading at just 0.23X sales, Carrols’ top line is thought to have expanded 8% in FY23 and is expected to rise another 4% this year to $1.94 billion.
Last but not least is Virco Manufacturing which designs, produces, and distributes quality furniture for the contract and education markets worldwide. Trading around $12 a share, Virco’s FY24 and FY25 earnings estimates have soared 20% and 17% over the last 60 days respectively.
Image Source: Zacks Investment Research
Virco's stock has soared +151% in the last year but still trades at just 8.9X forward earnings. Correlating with its stellar performance, Virco’s EPS is forecasted to expand 32% this year and soar another 27% in FY25 to $1.72 per share. Furthermore, Virco trades at 0.75X sales with its top line projected to leap 15% in FY24 and expand another 8% in FY25 to $289 million.
Image Source: Zacks Investment Research
Bottom Line
Now looks like a good time to buy these affordable highly ranked stocks with Arcos Dorados and Carrols Restaurant Group belonging to the top-rated Zacks Retail-Restaurant Industry which is in the top 25% of over 250 Zacks industries while Virco Manufacturing’s Zacks Furniture Industry is in the top 22%.
Positive earnings estimate revisions are very reassuring and could lead to more upside as their outlooks have continued to strengthen.
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3 Highly Ranked Stocks That Won't Break Your Piggybank
Investors are always looking for stocks that won’t break the bank and have fundamental value to support their “bargain” propositions. This is especially true with markets ripping higher over the last year but several top-rated Zacks stocks still stand out in terms of their affordability and value.
Even better, a few of these names have encouraging growth prospects as well which strengthens the narrative that their stocks should appreciate. Benefiting from strong business industries these companies also appear to be in a good position to take market share.
Furthermore, the risk to reward looks very favorable as these stocks currently boast a Zacks Rank #1 (Strong Buy). In addition to their strong buy rating, they also have an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
Hailing from the Zacks Retail and Wholesale sector and the Zacks Consumer Discretionary sector let’s take a look at these affordable and promising stocks.
Image Source: Zacks Investment Research
Arcos Dorados (ARCO - Free Report)
Quietly, Arcos Dorados has been one of the better-performing stocks over the last year up +41% but still 8% from its 52-week highs of $13 a share seen in late December.
As the largest franchisee of McDonald’s (MCD - Free Report) restaurants in the world, the dip looks attractive as Arcos operates the classic burger chains throughout Latin America. Arcos has over 2,000 McDonald’s branded restaurants with a presence in many South American countries including Brazil along with locations throughout the Caribbean and Mexico.
Trading at 12.7X forward earnings, Arcos is expected to round out its fiscal 2023 with EPS up 19% to $0.82 a share compared to $0.69 a share in 2022. Plus, FY24 earnings are projected to rise another 15% to $0.95 a share. More importantly, earnings estimate revisions have remained higher over the last 60 days for both FY23 and FY24.
Image Source: Zacks Investment Research
Arcos also has a price-to-sales ratio (P/S) of just 0.61X with double-digit top line growth forecasted as well. Notably, total sales are now expected to jump 19% in FY23 and rise another 10% in FY24 to $4.75 billion.
Image Source: Zacks Investment Research
Carrols Restaurant Group
Burger King’s largest franchisee in Carrols Restaurant Group also looks attractive with the trend of earnings estimate revisions very compelling over the last 60 days. Carrols operates nearly 1,000 Burger King restaurants throughout the United States and over 60 Popeyes restaurants.
Interestingly enough, Carrols' stock was one of the best performers in 2023 skyrocketing over 300% in the last year to current levles of around $8 a share.
Image Source: Zacks Investment Research
Rounding out its FY23, earnings estimates are up 16% in the last two months while FY24 EPS estimates have soared 24%. More intriguing, annual earnings are expected to climb swing to $0.49 a share versus an adjusted loss of -$0.70 a share in 2022. Fiscal 2024 earnings are forecasted to rise another 14% to $0.56 a share and Carrols' stock still trades at a reasonable 14.7X forward earnings multiple.
Image Source: Zacks Investment Research
Trading at just 0.23X sales, Carrols’ top line is thought to have expanded 8% in FY23 and is expected to rise another 4% this year to $1.94 billion.
Image Source: Zacks Investment Research
Virco Manufacturing (VIRC - Free Report)
Last but not least is Virco Manufacturing which designs, produces, and distributes quality furniture for the contract and education markets worldwide. Trading around $12 a share, Virco’s FY24 and FY25 earnings estimates have soared 20% and 17% over the last 60 days respectively.
Image Source: Zacks Investment Research
Virco's stock has soared +151% in the last year but still trades at just 8.9X forward earnings. Correlating with its stellar performance, Virco’s EPS is forecasted to expand 32% this year and soar another 27% in FY25 to $1.72 per share. Furthermore, Virco trades at 0.75X sales with its top line projected to leap 15% in FY24 and expand another 8% in FY25 to $289 million.
Image Source: Zacks Investment Research
Bottom Line
Now looks like a good time to buy these affordable highly ranked stocks with Arcos Dorados and Carrols Restaurant Group belonging to the top-rated Zacks Retail-Restaurant Industry which is in the top 25% of over 250 Zacks industries while Virco Manufacturing’s Zacks Furniture Industry is in the top 22%.
Positive earnings estimate revisions are very reassuring and could lead to more upside as their outlooks have continued to strengthen.