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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company to watch right now is M.D.C. . MDC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 3.26, which compares to its industry's average of 4.50. Over the past 52 weeks, MDC's Forward P/E has been as high as 6.76 and as low as 2.64, with a median of 5.22.
Investors will also notice that MDC has a PEG ratio of 0.54. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MDC's industry currently sports an average PEG of 0.56.
Investors should also recognize that MDC has a P/B ratio of 0.92. 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. This stock's P/B looks attractive against its industry's average P/B of 1.07. Over the past 12 months, MDC's P/B has been as high as 1.62 and as low as 0.74, with a median of 1.39.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MDC has a P/S ratio of 0.45. This compares to its industry's average P/S of 0.52.
Finally, our model also underscores that MDC has a P/CF ratio of 3.97. 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. MDC's current P/CF looks attractive when compared to its industry's average P/CF of 4.68. Within the past 12 months, MDC's P/CF has been as high as 7.17 and as low as 3.21, with a median of 6.
Value investors will likely look at more than just these metrics, but the above data helps show that M.D.C. Is likely undervalued currently. And when considering the strength of its earnings outlook, MDC sticks out at as one of the market's strongest value stocks.
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Are Investors Undervaluing M.D.C. (MDC) Right Now?
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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company to watch right now is M.D.C. . MDC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 3.26, which compares to its industry's average of 4.50. Over the past 52 weeks, MDC's Forward P/E has been as high as 6.76 and as low as 2.64, with a median of 5.22.
Investors will also notice that MDC has a PEG ratio of 0.54. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MDC's industry currently sports an average PEG of 0.56.
Investors should also recognize that MDC has a P/B ratio of 0.92. 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. This stock's P/B looks attractive against its industry's average P/B of 1.07. Over the past 12 months, MDC's P/B has been as high as 1.62 and as low as 0.74, with a median of 1.39.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MDC has a P/S ratio of 0.45. This compares to its industry's average P/S of 0.52.
Finally, our model also underscores that MDC has a P/CF ratio of 3.97. 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. MDC's current P/CF looks attractive when compared to its industry's average P/CF of 4.68. Within the past 12 months, MDC's P/CF has been as high as 7.17 and as low as 3.21, with a median of 6.
Value investors will likely look at more than just these metrics, but the above data helps show that M.D.C. Is likely undervalued currently. And when considering the strength of its earnings outlook, MDC sticks out at as one of the market's strongest value stocks.