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Is EZCORP (EZPW) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 company to watch right now is EZCORP (EZPW - Free Report) . EZPW is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

We also note that EZPW holds a PEG ratio of 0.35. 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. EZPW's PEG compares to its industry's average PEG of 0.72. EZPW's PEG has been as high as 0.42 and as low as 0.26, with a median of 0.31, all within the past year.

Another notable valuation metric for EZPW is its P/B ratio of 0.73. 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. This stock's P/B looks attractive against its industry's average P/B of 0.82. Over the past 12 months, EZPW's P/B has been as high as 0.86 and as low as 0.48, with a median of 0.64.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. EZPW has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.96.

These are only a few of the key metrics included in EZCORP's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, EZPW looks like an impressive value stock at the moment.


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