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Should Value Investors Buy Rush Enterprises (RUSHA) Stock?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Rush Enterprises (RUSHA - Free Report) is a stock many investors are watching right now. RUSHA is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

Investors will also notice that RUSHA has a PEG ratio of 1.12. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. RUSHA's PEG compares to its industry's average PEG of 2.32. Over the last 12 months, RUSHA's PEG has been as high as 1.89 and as low as 0.64, with a median of 1.31.

Finally, our model also underscores that RUSHA has a P/CF ratio of 9.68. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.41. RUSHA's P/CF has been as high as 9.80 and as low as 3.32, with a median of 6.50, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Rush Enterprises is likely undervalued currently. And when considering the strength of its earnings outlook, RUSHA sticks out at as one of the market's strongest value stocks.


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