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RICK or CNK: Which Is the Better Value Stock Right Now?

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Investors interested in Leisure and Recreation Services stocks are likely familiar with RCI Hospitality (RICK - Free Report) and Cinemark Holdings (CNK - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, RCI Hospitality has a Zacks Rank of #2 (Buy), while Cinemark Holdings has a Zacks Rank of #3 (Hold). This means that RICK's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.

RICK currently has a forward P/E ratio of 12.64, while CNK has a forward P/E of 111.58. We also note that RICK has a PEG ratio of 1.05. 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. CNK currently has a PEG ratio of 11.16.

Another notable valuation metric for RICK is its P/B ratio of 2.66. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, CNK has a P/B of 6.31.

These metrics, and several others, help RICK earn a Value grade of B, while CNK has been given a Value grade of C.

RICK sticks out from CNK in both our Zacks Rank and Style Scores models, so value investors will likely feel that RICK is the better option right now.


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Cinemark Holdings Inc (CNK) - free report >>

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