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MCS or MSG: Which Is the Better Value Stock Right Now?

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Investors with an interest in Leisure and Recreation Services stocks have likely encountered both Marcus (MCS - Free Report) and The Madison Square Garden Company . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Marcus and The Madison Square Garden Company are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that MCS's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

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

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

MCS currently has a forward P/E ratio of 24.74, while MSG has a forward P/E of 412.95. We also note that MCS has a PEG ratio of 1.65. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MSG currently has a PEG ratio of 16.07.

Another notable valuation metric for MCS is its P/B ratio of 2.66. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, MSG has a P/B of 2.71.

Based on these metrics and many more, MCS holds a Value grade of B, while MSG has a Value grade of F.

MCS has seen stronger estimate revision activity and sports more attractive valuation metrics than MSG, so it seems like value investors will conclude that MCS is the superior option right now.


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