Zacks.com featured highlights include SM Energy, Sonoco Products, El Pollo Loco, The Greenbrier and Plains GP

For Immediate ReleaseChicago, IL – January 29, 2025 – Stocks in this week’s article are SM Energy Co. SM, Sonoco Products Co. SON, El Pollo Loco Holdings, Inc. LOCO, The Greenbrier Companies, Inc. GBX and Plains GP Holdings, L.P. PAGP.Pick These 5 Bargain Stocks with Impressive EV-to-EBITDA RatiosInvestors generally tend to cling to the price-to-earnings (P/E) metric while looking for bargain stocks. In addition to being a widely used tool for screening stocks, P/E is also a popular metric to work out the fair market value of a company. But even this ubiquitously used valuation multiple has a few downsides.Although P/E is the most popular valuation metric, a more complicated multiple called EV-to-EBITDA works even better. Often considered a better alternative to P/E, it gives the true picture of a company's valuation and earnings potential and has a more complete approach to valuation. While P/E considers a firm's equity portion, EV-to-EBITDA determines its total value.SM Energy Co., Sonoco Products Co., El Pollo Loco Holdings, Inc., The Greenbrier Companies, Inc. and Plains GP Holdings, L.P. are some stocks with attractive EV-to-EBITDA ratios.EV-to-EBITDA is a Better Option, Here's WhyAlso 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.P/E also cannot 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 tool in measuring the value of firms that are highly leveraged and have a high degree of depreciation. It can also be used to compare companies with different levels of debt.However, EV-to-EBITDA is not devoid of limitations and alone cannot conclusively determine a stock's inherent potential and future performance. The multiple varies across industries and is usually not appropriate while comparing stocks in different industries, given their diverse capital expenditure 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 your desired results.Here are our five picks out of the 16 stocks that passed the screen:SM Energy is an independent oil and gas company engaged in the exploration, exploitation, development, acquisition and production of natural gas and crude oil in North America. This Zacks Rank #1 stock has a Value Score of A.SM Energy has an expected year-over-year earnings growth rate of 19.4% for 2025. SM's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters at an average of 11.7%.Sonoco Products is a leading provider of consumer packaging, industrial products, protective packaging and packaging supply-chain services. This Zacks Rank #1 stock has a Value Score of A. You can see the complete list of today's Zacks #1 Rank stocks here.Sonoco Products has an expected year-over-year earnings growth rate of 22.1% for 2025. SON's earnings beat the Zacks Consensus Estimate in three of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 1%, on average.El Pollo Loco develops, franchises, licenses and operates quick-service restaurants under the name El Pollo Loco. This Zacks Rank #1 stock has a Value Score of A.El Pollo Loco has an expected year-over-year earnings growth rate of 14.5% for 2025. The Zacks Consensus Estimate for LOCO's 2025 earnings has been revised 2.2% upward over the past 60 days.The Greenbrier Companies is a leading supplier of transportation equipment and services to the railroad and related industries. This Zacks Rank #1 stock has a Value Score of B.The Greenbrier Companies has an expected year-over-year earnings growth rate of 18.9% for fiscal 2025. The consensus estimate for GBX's fiscal 2025 earnings has been revised 13.5% upward over the past 60 days.Plains GP Holdings, through its subsidiaries, is involved in the transportation, storage, terminalling, and marketing of crude oil and refined products. This Zacks Rank #2 stock has a Value Score of A.Plains GP Holdings has an expected year-over-year earnings growth rate of 100.2% for 2025. The consensus estimate for PAGP's 2025 earnings has been revised 0.6% upward over the past 60 days.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.For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2404332/pick-these-5-bargain-stocks-with-impressive-ev-to-ebitda-ratiosDisclosure: 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.About Screen of the WeekZacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine.  But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.Strong Stocks that Should Be in the NewsMany are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.Follow us on Twitter:  https://www.twitter.com/zacksresearchJoin us on Facebook:  https://www.facebook.com/ZacksInvestmentResearchZacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.Contact: Jim GiaquintoCompany: Zacks.comPhone: 312-265-9268Email: pr@zacks.comVisit: https://www.zacks.com/Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want 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 Sonoco Products Company (SON): Free Stock Analysis Report SM Energy Company (SM): Free Stock Analysis Report Greenbrier Companies, Inc. (The) (GBX): Free Stock Analysis Report El Pollo Loco Holdings, Inc. (LOCO): Free Stock Analysis Report Plains Group Holdings, L.P. (PAGP): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks