Investors with an interest in Retail - Restaurants stocks have likely encountered both Papa Murphy's Holdings (FRSH - Free Report) and Texas Roadhouse (TXRH - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Papa Murphy's Holdings is sporting a Zacks Rank of #1 (Strong Buy), while Texas Roadhouse has a Zacks Rank of #5 (Strong Sell). This means that FRSH's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
FRSH currently has a forward P/E ratio of 13.95, while TXRH has a forward P/E of 29.42. We also note that FRSH has a PEG ratio of 1.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TXRH currently has a PEG ratio of 2.49.
Another notable valuation metric for FRSH is its P/B ratio of 0.94. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, TXRH has a P/B of 4.90.
These are just a few of the metrics contributing to FRSH's Value grade of B and TXRH's Value grade of D.
FRSH sticks out from TXRH in both our Zacks Rank and Style Scores models, so value investors will likely feel that FRSH is the better option right now.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Investors with an interest in Retail - Restaurants stocks have likely encountered both Papa Murphy's Holdings (FRSH - Free Report) and Texas Roadhouse (TXRH - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Papa Murphy's Holdings is sporting a Zacks Rank of #1 (Strong Buy), while Texas Roadhouse has a Zacks Rank of #5 (Strong Sell). This means that FRSH's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
FRSH currently has a forward P/E ratio of 13.95, while TXRH has a forward P/E of 29.42. We also note that FRSH has a PEG ratio of 1.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TXRH currently has a PEG ratio of 2.49.
Another notable valuation metric for FRSH is its P/B ratio of 0.94. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, TXRH has a P/B of 4.90.
These are just a few of the metrics contributing to FRSH's Value grade of B and TXRH's Value grade of D.
FRSH sticks out from TXRH in both our Zacks Rank and Style Scores models, so value investors will likely feel that FRSH is the better option right now.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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