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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 stock to keep an eye on is Dave & Buster's (PLAY - Free Report) . PLAY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 12.69. This compares to its industry's average Forward P/E of 26.73. Over the past 52 weeks, PLAY's Forward P/E has been as high as 22.15 and as low as 12.33, with a median of 16.91.
PLAY is also sporting a PEG ratio of 0.86. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PLAY's PEG compares to its industry's average PEG of 2.29. Within the past year, PLAY's PEG has been as high as 1.49 and as low as 0.83, with a median of 1.14.
Finally, we should also recognize that PLAY has a P/CF ratio of 6.18. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. PLAY's P/CF compares to its industry's average P/CF of 19.26. PLAY's P/CF has been as high as 11.39 and as low as 5.99, with a median of 8.48, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Dave & Buster's is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PLAY feels like a great value stock at the moment.