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Is RCI Hospitality (RICK) Stock Undervalued Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 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.

One company to watch right now is RCI Hospitality (RICK - Free Report) . RICK is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 7.82, while its industry has an average P/E of 19.17. RICK's Forward P/E has been as high as 10.10 and as low as 2.66, with a median of 7.13, all within the past year.

Investors will also notice that RICK has a PEG ratio of 0.65. 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. RICK's PEG compares to its industry's average PEG of 1.63. Within the past year, RICK's PEG has been as high as 0.81 and as low as 0.27, with a median of 0.50.

We should also highlight that RICK has a P/B ratio of 0.87. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. RICK's current P/B looks attractive when compared to its industry's average P/B of 1.32. Within the past 52 weeks, RICK's P/B has been as high as 1.53 and as low as 0.42, with a median of 1.02.

Finally, our model also underscores that RICK has a P/CF ratio of 7.86. 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. RICK's current P/CF looks attractive when compared to its industry's average P/CF of 9.15. Within the past 12 months, RICK's P/CF has been as high as 9.49 and as low as 2.41, with a median of 6.54.

These are just a handful of the figures considered in RCI Hospitality'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 RICK is an impressive value stock right now.


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