Should Value Investors Buy Dave & Buster's Entertainment (PLAY) Stock?

The proven Zacks Rank algorithm finds winning companies using earnings forecasts and revisions. We realize our readers have different opinions, so we always look into value, growth, and momentum trends to uncover good options.

Perhaps no stock market trend is more popular than value investing, which has worked in all market conditions. Fundamental analysis and standard valuation criteria help value investors uncover inexpensive stocks.

The revolutionary Style Scores system from Zacks highlights equities with distinct attributes. Value investors like stocks with high "Value" ratings. With a high Zacks Rank, "A" Value stocks are among the best on the market.

Look out for Dave & Buster's Entertainment (PLAY). PLAY has a #2 Zacks Rank (Buy) and an A for Value. The stock has a 13.17 P/E, while its industry averages 23.48. PLAY's Forward P/E ranged from 16.31 to 8.74 in the past year, averaging 10.61.

PEG ratio of 0.68 is also noticeable to investors. PEG ratios, like P/E ratios, take into account a company's predicted profits growth rate. PLAY's PEG is near the industry average of 1.70.

Our model also shows PLAY's 6.82 P/CF ratio. This statistic shows a company's operational cash flow and may be used to uncover undervalued corporations with strong cash outlooks. PLAY's P/CF rivals the industry average of 17.83. PLAY's P/CF ranged from 7.29 to 4.34 in the previous year, with a median of 5.57.

Carrols Restaurant Group (TAST), a #1 (Strong Buy) stock with an A Value Score, is another superb Retail - Restaurants option. Carrols Restaurant Group's P/B is 2.82, compared to -27.97 for its industry. Over the previous year, TAST's valuation measure has ranged from 2.83 to 0.67, with a median of 1.85.

These criteria are only a few value investors use, but they suggest Dave & Buster's Entertainment and Carrols Restaurant Group are undervalued. PLAY and TAST might be a good value stock given its earnings projection and current valuation.