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Is RCI Hospitality (RICK) 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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

RCI Hospitality (RICK - Free Report) is a stock many investors are watching right now. RICK is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 11.75 right now. For comparison, its industry sports an average P/E of 25.58. RICK's Forward P/E has been as high as 15.80 and as low as 8.83, with a median of 12.34, all within the past year.

Investors will also notice that RICK has a PEG ratio of 0.98. 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. RICK's industry currently sports an average PEG of 1.62. Over the last 12 months, RICK's PEG has been as high as 1.32 and as low as 0.74, with a median of 1.03.

Another notable valuation metric for RICK is its P/B ratio of 2.57. 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. This stock's P/B looks solid versus its industry's average P/B of 3.63. Within the past 52 weeks, RICK's P/B has been as high as 3.66 and as low as 1.94, with a median of 2.80.

These are just a handful of the figures considered in RCI Hospitality's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that RICK is an impressive value stock right now.


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