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Are Investors Undervaluing Arcos Dorados (ARCO) Right Now?
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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.
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 company value investors might notice is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 18.69, which compares to its industry's average of 23.60. Over the last 12 months, ARCO's Forward P/E has been as high as 28.70 and as low as 16.54, with a median of 19.24.
Investors will also notice that ARCO has a PEG ratio of 0.96. 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. ARCO's PEG compares to its industry's average PEG of 2.12.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. ARCO has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.91.
Finally, our model also underscores that ARCO has a P/CF ratio of 9.24. 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. ARCO's P/CF compares to its industry's average P/CF of 16.96. Within the past 12 months, ARCO's P/CF has been as high as 13.26 and as low as 7.46, with a median of 9.14.
These are just a handful of the figures considered in Arcos Dorados'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 ARCO is an impressive value stock right now.
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Are Investors Undervaluing Arcos Dorados (ARCO) Right Now?
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.
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 company value investors might notice is Arcos Dorados (ARCO - Free Report) . ARCO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 18.69, which compares to its industry's average of 23.60. Over the last 12 months, ARCO's Forward P/E has been as high as 28.70 and as low as 16.54, with a median of 19.24.
Investors will also notice that ARCO has a PEG ratio of 0.96. 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. ARCO's PEG compares to its industry's average PEG of 2.12.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. ARCO has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.91.
Finally, our model also underscores that ARCO has a P/CF ratio of 9.24. 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. ARCO's P/CF compares to its industry's average P/CF of 16.96. Within the past 12 months, ARCO's P/CF has been as high as 13.26 and as low as 7.46, with a median of 9.14.
These are just a handful of the figures considered in Arcos Dorados'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 ARCO is an impressive value stock right now.