Is It Too Late To Consider Buying Accel Entertainment, Inc. (NYSE: ACEL )?

Accel Entertainment (NYSE ticker: ACEL), may not be a big-cap stock, but shares have surged more than 20% on the New York Stock Exchange over the past few months. As a stock highly watched by analysts, you can assume that any recent changes in the company’s outlook have been priced into the stock. But what if the stock is still cheap? Today I’m going to analyze the latest data on Accel Entertainment’s outlook and valuation to see if opportunities still exist.

Check out our latest analysis for Accel Entertainment

Is Accel Entertainment still cheap?

Great news, investors! Accel Entertainment remains a bargain right now according to my price multiple model, which compares the company’s price-earnings ratio to the industry average. I’m using a P/E ratio in this example because there isn’t enough visibility to forecast its cash flow. The stock’s current ratio of 11.7x is well below the industry average of 18.56x, which means it is trading at a discount to its peers. However, given that Accel Entertainment stock is quite volatile (ie its price movements are amplified relative to the rest of the market), this could mean that the price could drop, giving us another opportunity to buy in the future. This is based on its high beta, which is a good indicator of stock price volatility.

Can we expect growth from Accel Entertainment?

Future prospects are an important aspect when you’re considering buying stocks, especially if you’re an investor looking for portfolio growth. While a value investor will argue that what matters most is intrinsic value relative to price, a more compelling investment thesis is high growth potential at a low price. Accel Entertainment’s earnings growth is expected to remain in the mid-teens over the next few years, suggesting a bright future ahead. That should lead to strong cash flow, and thus a higher stock price.

what this means to you

Are you a shareholder? With ACEL currently trading below its industry P/E ratio, now might be a good time to add more shares. Given the rosy profit outlook, that growth doesn’t appear to be fully priced into the share price yet. However, there are other factors to consider, such as financials, which could explain the current price multiple.

Are you a potential investor? If you’ve been following ACEL for a while, now might be the time to get in. Its future earnings outlook isn’t fully priced into the current share price, which means it’s not too late to buy ACEL. But before making any investment decisions, consider other factors, such as the strength of its balance sheet, in order to make an informed assessment.

Remember, when analyzing stocks, it is worth noting the risks involved.On Simply Wall St we find 2 warning signs for Accel Entertainment We think they deserve your attention.

If you are no longer interested in Accel Entertainment, you can use our free platform to view our over list Other 50 stocks with high growth potential.

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This article by Simply Wall St is general in nature. We use only an unbiased methodology to provide reviews based on historical data and analyst forecasts, and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take into account your objectives or your financial situation. Our goal is to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no positions in any of the stocks mentioned.