Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is The Marcus (MCS). MCS is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. MCS has a P/S ratio of 1.06. This compares to its industry's average P/S of 2.15.
Finally, investors should note that MCS has a P/CF ratio of 5.70. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. MCS's P/CF compares to its industry's average P/CF of 13.28. Within the past 12 months, MCS's P/CF has been as high as 12.94 and as low as 5.33, with a median of 9.24.
These figures are just a handful of the metrics value investors tend to look at, but they help show that The Marcus is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MCS feels like a great value stock at the moment.
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Marcus Corporation (The) (MCS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).