Should Value Investors Buy Brinker International (EAT) Stock?

EAT TAST

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Brinker International (EAT - Free Report) . EAT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 10.61, while its industry has an average P/E of 23.39. Over the past 52 weeks, EAT's Forward P/E has been as high as 13.42 and as low as 8.41, with a median of 10.78.

Investors will also notice that EAT has a PEG ratio of 0.64. 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. EAT's PEG compares to its industry's average PEG of 1.66. EAT's PEG has been as high as 1.92 and as low as 0.56, with a median of 1.46, all within the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. EAT has a P/S ratio of 0.41. This compares to its industry's average P/S of 0.96.

Finally, investors will want to recognize that EAT has a P/CF ratio of 5.84. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. EAT's P/CF compares to its industry's average P/CF of 17.73. Over the past year, EAT's P/CF has been as high as 7.62 and as low as 4.34, with a median of 6.35.

Another great Retail - Restaurants stock you could consider is Carrols Restaurant Group (TAST - Free Report) , which is a # 1 (Strong Buy) stock with a Value Score of A.

Furthermore, Carrols Restaurant Group holds a P/B ratio of 2.81 and its industry's price-to-book ratio is -27.81. TAST's P/B has been as high as 2.83, as low as 0.67, with a median of 1.81 over the past 12 months.

These are only a few of the key metrics included in Brinker International and Carrols Restaurant Group strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, EAT and TAST look like an impressive value stock at the moment.

Zacks Names #1 Semiconductor Stock

It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.

With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.

See This Stock Now for Free >>