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Is Manulife Financial (MFC) Stock Undervalued Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Manulife Financial (MFC - Free Report) is a stock many investors are watching right now. MFC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 6.57, which compares to its industry's average of 8.49. MFC's Forward P/E has been as high as 12.19 and as low as 6.51, with a median of 8.78, all within the past year.

Another notable valuation metric for MFC is its P/B ratio of 0.90. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.64. MFC's P/B has been as high as 1.46 and as low as 0.89, with a median of 1.15, over the past year.

Finally, we should also recognize that MFC has a P/CF ratio of 7.42. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. MFC's P/CF compares to its industry's average P/CF of 16.02. Over the past year, MFC's P/CF has been as high as 14.68 and as low as 7.35, with a median of 11.02.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Manulife Financial is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MFC feels like a great value stock at the moment.


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