Should Value Investors Buy Boot Barn (BOOT) Stock?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Boot Barn (BOOT). BOOT is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.
Investors should also note that BOOT holds a PEG ratio of 0.93. 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. BOOT's industry currently sports an average PEG of 1.28. Over the past 52 weeks, BOOT's PEG has been as high as 1.16 and as low as 0.49, with a median of 0.93.
Investors should also recognize that BOOT has a P/B ratio of 3.27. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 3.50. BOOT's P/B has been as high as 3.88 and as low as 1.87, with a median of 2.98, over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Boot Barn is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BOOT feels like a great value stock at the moment.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.