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CAKE or BROS: Which Is the Better Value Stock Right Now?
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Investors interested in Retail - Restaurants stocks are likely familiar with Cheesecake Factory (CAKE - Free Report) and Dutch Bros (BROS - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, both Cheesecake Factory and Dutch Bros are holding a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
CAKE currently has a forward P/E ratio of 14.35, while BROS has a forward P/E of 114.38. We also note that CAKE has a PEG ratio of 1.30. 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. BROS currently has a PEG ratio of 4.10.
Another notable valuation metric for CAKE is its P/B ratio of 6.09. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, BROS has a P/B of 9.46.
Based on these metrics and many more, CAKE holds a Value grade of A, while BROS has a Value grade of F.
Both CAKE and BROS are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CAKE is the superior value option right now.
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CAKE or BROS: Which Is the Better Value Stock Right Now?
Investors interested in Retail - Restaurants stocks are likely familiar with Cheesecake Factory (CAKE - Free Report) and Dutch Bros (BROS - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, both Cheesecake Factory and Dutch Bros are holding a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
CAKE currently has a forward P/E ratio of 14.35, while BROS has a forward P/E of 114.38. We also note that CAKE has a PEG ratio of 1.30. 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. BROS currently has a PEG ratio of 4.10.
Another notable valuation metric for CAKE is its P/B ratio of 6.09. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, BROS has a P/B of 9.46.
Based on these metrics and many more, CAKE holds a Value grade of A, while BROS has a Value grade of F.
Both CAKE and BROS are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CAKE is the superior value option right now.