Which stock currently offers the better value?

Investors interested in retail and restaurant stocks have probably come across BJ’s Restaurants (BJRI) and Portillo’s Inc. (PTLO). But which of these two stocks is more attractive to value investors? To find out, we need to take a closer look at the stock.

The best way to find great value stocks is to combine a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank highlights companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, BJ’s Restaurants has a Zacks Rank of #2 (Buy), while Portillo’s Inc. has a Zacks Rank of #3 (Hold). This means that BJRI’s earnings estimate revisions have been more impressive, so investors should be happy about the improved analyst outlook. However, for value investors, this is only part of the picture.

Value investors also try to analyze a wide range of traditional numbers and metrics to determine whether a company is undervalued at its current share price level.

The Style Score Value assessment incorporates a number of important fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and numerous other key statistics commonly used by value investors.

BJRI currently has a forward P/E ratio of 46.16, while PTLO has a forward P/E ratio of 80.79. We also note that BJRI has a PEG ratio of 3.08. This metric is used similarly to the well-known P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. PTLO currently has a PEG ratio of 7.18.

Another important valuation metric for BJRI is its P/B ratio of 2.26. The P/B ratio compares a stock’s market value to its book value, which is defined as total assets minus total liabilities. For comparison, PTLO has a P/B ratio of 3.01.

These are just some of the metrics that contribute to the B score for BJRI and the C score for PTLO.

BJRI stands out from PTLO in our Zacks Rank and Style Scores models, so value investors likely consider BJRI to be the better option right now.

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BJ’s Restaurants, Inc. (BJRI): Free Stock Analysis Report

Portillo’s Inc. (PTLO): Free Stock Analysis Report

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