Back to top

Image: Bigstock

Bull Of The Day: Agilysys (AGYS)

Read MoreHide Full Article

Agilysys (AGYS - Free Report) is the Bull of the Day after it ran an impressive 15% yesterday.  So why is it the Bull today after such a strong showing yesterday?  Well the Bull of the Day is more about explaining how the Zacks Rank can help you find better stocks... but there is more to this story.

Description

Agilysys operates as a developer and marketer of hardware and software products and services to the hospitality industry. The company offers point of sale, property management systems, payment, business intelligence, guest self-service, inventory and procurement, reservations, table management, activity scheduling, golf and spa management, document management, and online booking solutions to enhance guest experience. Agilysys, Inc. was founded in 1963 and is headquartered in Alpharetta, Georgia.

Chart

I almost never lead with a chart because I am much more of a fundamentals sort of guy.  That said, the chart can tell you somethings... most of which are where the price was in the past.

What Does This Tell You?

Well I see the stock doing fine until the COVID Crash... then the bottom fell out and there has not really been a recovery trade in this name like we have seen in so many others.

Basic logic will tell you that hotels will not cease to exist.  They will return to business as usual at some point -- and that could be sooner than Wall Street expects.  

We have seen many other stocks move higher here, but until yesterday AGYS hasn't moved that much off the bottom.

The 15% move yesterday came with the broader market moving much higher but it could only be the start of things to come.

Zacks Rank #2 (Buy)

The Zacks Rank is an algorithm that looks at the movement in all earnings estimates and then ranks them.  There are other factors such as earnings beats and misses... but for the most part, it is the earnings estimate revisions that drive the rank.

For AGYS the earnings history isn't great with three misses and one beat over the last four quarters.

Earnings Estimates

I see some good moves in estimates for AGYS.  This quarter moved from a loss of 9 cents to a loss of 6 cents.  Next quarter is even better as estimates moved from a loss of 9 cent so a loss of 5 cents over the same time horizon.

The Rank gives more weight to full year numbers. The 2020 fiscal number has moved from a loss of 42 cents to a loss of 36 cents.  Next year saw a nice bump of 13 cents in the right direction.

Valuation

No earnings mean no PE to lean on... but we have the other metrics to look at.  3.4x book is super reasonable for a stock that is posting topline growth of 16%.  A 2.1x prices to sales multiple is also pretty low for a software name.

Margins are headed in the right direction and as they continue to improve the flip to profitability will only increase the number of eyeballs on this stock.

Chart Part 2

 

Agilysys, Inc. Price, Consensus and EPS Surprise

Agilysys, Inc. Price, Consensus and EPS Surprise

Agilysys, Inc. price-consensus-eps-surprise-chart | Agilysys, Inc. Quote

Breakout Biotech Stocks with Triple-Digit Profit Potential

The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.

Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.

See these 7 breakthrough stocks now>>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Agilysys, Inc. (AGYS) - free report >>

Published in