Tap These 5 Bargain Stocks With Enticing EV-to-EBITDA Ratios

Core Insights - Investors often focus on the price-to-earnings (P/E) ratio for stock valuation, but this metric has limitations and may not always reflect a company's true value [1][6] - The EV-to-EBITDA ratio is considered a more comprehensive valuation metric, as it accounts for a company's total value and provides a clearer picture of profitability [2][4] Valuation Metrics - The EV-to-EBITDA ratio is calculated by dividing a company's enterprise value (EV) by its earnings before interest, taxes, depreciation, and amortization (EBITDA), offering a more complete valuation approach [4] - A lower EV-to-EBITDA ratio typically indicates that a stock may be undervalued, making it an attractive option for investors [5] Stock Recommendations - Stocks such as El Pollo Loco Holdings, Inc. (LOCO), OppFi Inc. (OPFI), Edison International (EIX), ScanSource, Inc. (SCSC), and Zions Bancorporation (ZION) have been identified as having attractive EV-to-EBITDA ratios [3][11] - Each of these stocks meets specific screening criteria, including low EV-to-EBITDA ratios, P/E ratios below industry medians, and strong growth potential [8][10] Growth Projections - El Pollo Loco is expected to have a year-over-year earnings growth rate of 7.9% for 2025, with a recent upward revision of 4.4% in earnings estimates [12] - OppFi is projected to have a significant earnings growth rate of 65.3% for 2025, with a 10.6% upward revision in earnings estimates [13] - Edison International anticipates a 23.7% earnings growth rate for 2025, with a slight upward revision of 0.5% in estimates [14] - ScanSource expects a year-over-year earnings growth rate of 15.7% for fiscal 2026, with a 4% upward revision in estimates [15] - Zions Bancorporation has a projected earnings growth rate of 19% for 2025, with a 2.1% upward revision in estimates [16]