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Are Investors Undervaluing Aramark (ARMK) 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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Aramark (ARMK - Free Report) . ARMK is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
We also note that ARMK holds a PEG ratio of 1.12. 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. ARMK's PEG compares to its industry's average PEG of 2.13. Over the last 12 months, ARMK's PEG has been as high as 1.14 and as low as 0.35, with a median of 0.73.
We should also highlight that ARMK has a P/B ratio of 2.07. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. ARMK's current P/B looks attractive when compared to its industry's average P/B of 2.22. Within the past 52 weeks, ARMK's P/B has been as high as 3.64 and as low as 1.71, with a median of 2.79.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ARMK has a P/S ratio of 0.41. This compares to its industry's average P/S of 0.89.
Finally, investors will want to recognize that ARMK has a P/CF ratio of 6.33. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 16.43. ARMK's P/CF has been as high as 15.13 and as low as 5.25, with a median of 9.49, all within the past year.
If you're looking for another solid Food - Miscellaneous value stock, take a look at Post Holdings (POST - Free Report) . POST is a # 1 (Strong Buy) stock with a Value score of A.
Post Holdings sports a P/B ratio of 1.60 as well; this compares to its industry's price-to-book ratio of 2.22. In the past 52 weeks, POST's P/B has been as high as 1.64, as low as 1.27, with a median of 1.42.
These are just a handful of the figures considered in Aramark and Post Holdings'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 ARMK and POST is an impressive value stock right now.
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Are Investors Undervaluing Aramark (ARMK) Right Now?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Aramark (ARMK - Free Report) . ARMK is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
We also note that ARMK holds a PEG ratio of 1.12. 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. ARMK's PEG compares to its industry's average PEG of 2.13. Over the last 12 months, ARMK's PEG has been as high as 1.14 and as low as 0.35, with a median of 0.73.
We should also highlight that ARMK has a P/B ratio of 2.07. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. ARMK's current P/B looks attractive when compared to its industry's average P/B of 2.22. Within the past 52 weeks, ARMK's P/B has been as high as 3.64 and as low as 1.71, with a median of 2.79.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ARMK has a P/S ratio of 0.41. This compares to its industry's average P/S of 0.89.
Finally, investors will want to recognize that ARMK has a P/CF ratio of 6.33. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 16.43. ARMK's P/CF has been as high as 15.13 and as low as 5.25, with a median of 9.49, all within the past year.
If you're looking for another solid Food - Miscellaneous value stock, take a look at Post Holdings (POST - Free Report) . POST is a # 1 (Strong Buy) stock with a Value score of A.
Post Holdings sports a P/B ratio of 1.60 as well; this compares to its industry's price-to-book ratio of 2.22. In the past 52 weeks, POST's P/B has been as high as 1.64, as low as 1.27, with a median of 1.42.
These are just a handful of the figures considered in Aramark and Post Holdings'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 ARMK and POST is an impressive value stock right now.