Pick These 5 Bargain Stocks With Alluring EV-to-EBITDA Ratios

Zacks06-07

Price-to-earnings (P/E), given its inherent simplicity, is the most commonly used metric in the value-investing world. It is preferred by many investors while handpicking stocks trading at a bargain. ...

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It is preferred by many investors while handpicking stocks trading at a bargain. ...</p>\n\n<a href=\"https://finance.yahoo.com/news/pick-5-bargain-stocks-alluring-112800627.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Pick These 5 Bargain Stocks With Alluring EV-to-EBITDA Ratios</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPick These 5 Bargain Stocks With Alluring EV-to-EBITDA Ratios\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-06-07 19:28 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/pick-5-bargain-stocks-alluring-112800627.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Price-to-earnings (P/E), given its inherent simplicity, is the most commonly used metric in the value-investing world. It is preferred by many investors while handpicking stocks trading at a bargain. ...</p>\n\n<a href=\"https://finance.yahoo.com/news/pick-5-bargain-stocks-alluring-112800627.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"DNOW","symbol_name":"NOW Inc.","start_time":0,"source_url":"https://finance.yahoo.com/news/pick-5-bargain-stocks-alluring-112800627.html","article_id":"2441655510","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/nSjhnh4ahDSefziQceMQWw--~B/aD00MDA7dz02MzU7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/1b52d31540a4ef5a5795817baf5f79d2"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2441655510","pubTimestamp":1717759680,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Price-to-earnings (P/E), given its inherent simplicity, is the most commonly used metric in the value-investing world. It is preferred by many investors while handpicking stocks trading at a bargain. However, even this straightforward, broadly used valuation metric has a few downsides.While P/E enjoys great popularity among value investors, a less-used and more complicated metric called EV-to-EBITDA is sometimes viewed as a better alternative. EV-to-EBITDA gives the true picture of a company’s valuation and earnings potential. It has a more comprehensive approach to valuation. M/I Homes, Inc. MHO, DNOW Inc. DNOW, Fortuna Silver Mines Inc. FSM, The ODP Corporation ODP and AAR Corp. AIR are some stocks with attractive EV-to-EBITDA ratios.Here are the parameters to screen for bargain stocks:EV-to-EBITDA 12 Months-Most Recent less than X-Industry Medi","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"DNOW":"NOW Inc.","IE00B7SZL793.SGD":"Legg Mason Royce - US Small Cap Opportunity A Acc SGD-H","ODP":"欧迪办公","BK4585":"ETF&股票定投概念","BK4200":"专卖店","BK4572":"航空租赁","BK4588":"碎股","BK4187":"航天航空与国防","BK4088":"住宅建筑","MHO":"MI 家居","FSM":"Fortuna Silver Mines Inc","IE00B19Z4B17.USD":"LEGG MASON ROYCE US SMALL CAP OPPORTUNITY \"A\" (USD) ACC","BK4210":"白银","AIR":"AAR公司","BK4104":"贸易公司与经销商","IE0031619046.USD":"LEGG MASON ROYCE US SMALL CAP OPPORTUNITY \"A\" (USD) INC","IE00B66KJ199.SGD":"LEGG MASON ROYCE US SMALL CAP OPPORTUNITY  \" A\" (SGD) ACC"},"translate_title":"挑选这5只EV与EBITDA比率诱人的廉价股票","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ODP":1,"MHO":1,"AIR":1,"DNOW":1,"FSM":0.9},"content_text":"Price-to-earnings (P/E), given its inherent simplicity, is the most commonly used metric in the value-investing world. It is preferred by many investors while handpicking stocks trading at a bargain. However, even this straightforward, broadly used valuation metric has a few downsides.While P/E enjoys great popularity among value investors, a less-used and more complicated metric called EV-to-EBITDA is sometimes viewed as a better alternative. EV-to-EBITDA gives the true picture of a company’s valuation and earnings potential. It has a more comprehensive approach to valuation.  M/I Homes, Inc. MHO, DNOW Inc. DNOW, Fortuna Silver Mines Inc. FSM, The ODP Corporation ODP and AAR Corp. AIR are some stocks with attractive EV-to-EBITDA ratios.\nEV-to-EBITDA is a Better Option, Here’s Why\nAlso referred to as enterprise multiple, EV-to-EBITDA is the enterprise value (EV) of a stock divided by its earnings before interest, taxes, depreciation and amortization (EBITDA). EV is the sum of a company’s market capitalization, its debt and preferred stock minus cash and cash equivalents. In essence, it is the entire value of a company.EBITDA, the other element of the ratio, gives a clearer picture of a company’s profitability as it strips out non-cash expenses like depreciation and amortization that reduce net earnings. It is also often used as a proxy for cash flows.Generally, the lower the EV-to-EBITDA ratio, the more enticing it is. A low EV-to-EBITDA ratio could indicate that a stock is potentially undervalued.  Unlike the P/E ratio, EV-to-EBITDA takes debt on a company’s balance sheet into account. For this reason, it is typically used to value potential acquisition targets. The ratio shows the amount of debt that the acquirer has to bear. Stocks flaunting a low EV-to-EBITDA multiple could be seen as attractive takeover candidates.Moreover, P/E can’t be used to value a loss-making firm. A firm’s earnings are also subject to accounting estimates and management manipulation. In contrast, EV-to-EBITDA is harder to manipulate and can be used to value companies that have negative net earnings but are positive on the EBITDA front.EV-to-EBITDA is also a useful yardstick in measuring the value of firms that are highly leveraged and have a high degree of depreciation. Moreover, it can be used to compare companies with different levels of debt.However, EV-to-EBITDA is also not without its shortcomings and alone cannot conclusively determine a stock’s inherent potential and future performance. The ratio varies across industries and is generally not appropriate while comparing stocks in different industries, given their diverse capital spending requirements.As such, instead of just relying on EV-to-EBITDA, you can club it with the other major ratios, such as price-to-book (P/B), P/E and price-to-sales (P/S), to achieve the desired results.\nScreening Criteria\nHere are the parameters to screen for bargain stocks:EV-to-EBITDA 12 Months-Most Recent less than X-Industry Median: A lower EV-to-EBITDA ratio represents a cheaper valuation.P/E using (F1) less than X-Industry Median: This metric screens stocks that are trading at a discount to their peers.P/B less than X-Industry Median: A lower P/B compared with the industry average implies that the stock is undervalued.P/S less than X-Industry Median: The lower the P/S ratio, the more attractive the stock is, as investors will have to pay a smaller price for the same amount of sales generated by the company.Estimated One-Year EPS Growth F(1)/F(0) greater than or equal to X-Industry Median: This parameter will help in screening stocks that have growth rates higher than the industry median. This is a meaningful indicator, as decent earnings growth always adds to investor optimism.Average 20-day Volume greater than or equal to 100,000: The addition of this metric ensures that shares can be traded easily.Current Price greater than or equal to $5: This parameter will help in screening stocks that are trading at a minimum price of $5 or higher.Zacks Rank less than or equal to 2: No screening is complete without the Zacks Rank, which has proven its worth since inception. It is a fundamental truth that stocks with a Zacks Rank #1 (Strong Buy) or 2 (Buy) have always managed to beat adversities and outperform the market.Value Score of less than or equal to B: Our research shows that stocks with a Value Score of A or B, when combined with a Zacks Rank #1 or 2, offer the best upside potential.Here are our five picks out of the 14 stocks that passed the screen:M/I Homes is one of the leading builders of single-family homes. This Zacks Rank #1 stock has a Value Score of B.M/I Homes has an expected year-over-year earnings growth rate of 12.2% for 2024. The Zacks Consensus Estimate for MHO’s 2024 earnings has been revised 11.2% upward over the last 60 days.DNOW is a supplier of energy and industrial products and packaged, engineered process and production equipment. This Zacks Rank #1 stock has a Value Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.DNOW has an expected earnings growth rate of 9.3% for 2024. The consensus estimate for DNOW’s 2024 earnings has been revised 3.9% upward over the past 60 days.Fortuna Silver Mines is engaged in the exploration, mining and development of silver and base metal properties. This Zacks Rank #2 stock has a Value Score of A.Fortuna Silver Mines has an expected earnings growth rate of 68.2% for 2024. The consensus estimate for FSM’s 2024 earnings has been revised 132.4% upward over the past 60 days.ODP is one of the leading providers of business services and supplies, products and technology solutions to small, medium and enterprise businesses. This Zacks Rank #2 stock has a Value Score of A.ODP has an expected year-over-year earnings growth rate of 7.7% for 2024. The Zacks Consensus Estimate for the company’s 2024 earnings has been revised 5.6% upward over the past 60 days.AAR provides various products and services to the aviation and defense industries worldwide. AIR, a Zacks Rank #2 stock, has a Value Score of B.AAR has an expected year-over-year earnings growth rate of 15.4% for the current fiscal year. AIR beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being roughly 4%.You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.Click here to sign up for a free trial to the Research Wizard today.Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nThe ODP Corporation (ODP) : Free Stock Analysis Report\nAAR Corp. (AIR) : Free Stock Analysis Report\nM/I Homes, Inc. (MHO) : Free Stock Analysis Report\nFortuna Silver Mines Inc. (FSM) : Free Stock Analysis Report\nDNOW Inc. (DNOW) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.24.2","shortVersion":"4.24.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2441655510"}