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BLMN or SHAK: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Retail - Restaurants sector have probably already heard of Bloomin' Brands (BLMN - Free Report) and Shake Shack (SHAK - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Bloomin' Brands has a Zacks Rank of #1 (Strong Buy), while Shake Shack has a Zacks Rank of #3 (Hold) right now. This means that BLMN's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
BLMN currently has a forward P/E ratio of 11.30, while SHAK has a forward P/E of 65.42. We also note that BLMN has a PEG ratio of 2.85. 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. SHAK currently has a PEG ratio of 8.10.
Another notable valuation metric for BLMN is its P/B ratio of 2.17. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SHAK has a P/B of 5.55.
These metrics, and several others, help BLMN earn a Value grade of A, while SHAK has been given a Value grade of D.
BLMN has seen stronger estimate revision activity and sports more attractive valuation metrics than SHAK, so it seems like value investors will conclude that BLMN is the superior option right now.
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BLMN or SHAK: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Retail - Restaurants sector have probably already heard of Bloomin' Brands (BLMN - Free Report) and Shake Shack (SHAK - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Bloomin' Brands has a Zacks Rank of #1 (Strong Buy), while Shake Shack has a Zacks Rank of #3 (Hold) right now. This means that BLMN's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
BLMN currently has a forward P/E ratio of 11.30, while SHAK has a forward P/E of 65.42. We also note that BLMN has a PEG ratio of 2.85. 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. SHAK currently has a PEG ratio of 8.10.
Another notable valuation metric for BLMN is its P/B ratio of 2.17. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SHAK has a P/B of 5.55.
These metrics, and several others, help BLMN earn a Value grade of A, while SHAK has been given a Value grade of D.
BLMN has seen stronger estimate revision activity and sports more attractive valuation metrics than SHAK, so it seems like value investors will conclude that BLMN is the superior option right now.