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Should Value Investors Buy Dick's Sporting Goods (DKS) Stock?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

Dick's Sporting Goods (DKS - Free Report) is a stock many investors are watching right now. DKS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Another notable valuation metric for DKS is its P/B ratio of 2.39. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. DKS's current P/B looks attractive when compared to its industry's average P/B of 5.89. Within the past 52 weeks, DKS's P/B has been as high as 2.39 and as low as 1.53, with a median of 1.82.

Finally, investors should note that DKS has a P/CF ratio of 7.43. 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 19.48. Over the past 52 weeks, DKS's P/CF has been as high as 7.43 and as low as 5, with a median of 6.05.

These are only a few of the key metrics included in Dick's Sporting Goods's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, DKS looks like an impressive value stock at the moment.


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