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Should Value Investors Buy BuildABear Workshop (BBW) 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One company value investors might notice is BuildABear Workshop (BBW - Free Report) . BBW is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.39, while its industry has an average P/E of 16.70. BBW's Forward P/E has been as high as 8.74 and as low as 5.95, with a median of 6.84, all within the past year.

Finally, our model also underscores that BBW has a P/CF ratio of 6.79. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. BBW's P/CF compares to its industry's average P/CF of 19.73. Over the past year, BBW's P/CF has been as high as 7.11 and as low as 4.66, with a median of 5.77.

These are just a handful of the figures considered in BuildABear Workshop'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 BBW is an impressive value stock right now.


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