Is Accel Entertainment (ACEL) Stock Undervalued Right Now?

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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 value investors might notice is Accel Entertainment (ACEL). ACEL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 13.54, which compares to its industry’s average of 32.85. ACEL’s Forward P/E has been as high as 17.76 and as low as 10.93, with a median of 13.93, all within the past year.

We should also highlight that ACEL has a P/B ratio of 4.58. 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 11.62. Over the past 12 months, ACEL’s P/B has been as high as 5.08 and as low as 3.90, with a median of 4.41.

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. ACEL has a P/S ratio of 0.79. This compares to its industry’s average P/S of 1.17.

Finally, investors will want to recognize that ACEL has a P/CF ratio of 8.90. 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. ACEL’s current P/CF looks attractive when compared to its industry’s average P/CF of 30.77. ACEL’s P/CF has been as high as 9.76 and as low as 7.45, with a median of 8.58, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Accel Entertainment is likely undervalued currently. And when considering the strength of its earnings outlook, ACEL sticks out at as one of the market’s strongest value stocks.

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