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Are Investors Undervaluing Cracker Barrel Old Country Store (CBRL) Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

One stock to keep an eye on is Cracker Barrel Old Country Store (CBRL - Free Report) . CBRL is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CBRL has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.46.

Finally, investors will want to recognize that CBRL has a P/CF ratio of 4.98. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 17.37. Over the past 52 weeks, CBRL's P/CF has been as high as 13.38 and as low as 4.98, with a median of 11.83.

Value investors will likely look at more than just these metrics, but the above data helps show that Cracker Barrel Old Country Store is likely undervalued currently. And when considering the strength of its earnings outlook, CBRL sticks out at as one of the market's strongest value stocks.


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