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Should Value Investors Buy Mitsubishi (MSBHF) Stock?

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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.

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.

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.

Mitsubishi (MSBHF - Free Report) is a stock many investors are watching right now. MSBHF is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 14.31. This compares to its industry's average Forward P/E of 17.09. MSBHF's Forward P/E has been as high as 15.96 and as low as 10.10, with a median of 12.65, all within the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. MSBHF has a P/S ratio of 0.65. This compares to its industry's average P/S of 1.16.

Finally, our model also underscores that MSBHF has a P/CF ratio of 8.44. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 16.10. Over the past 52 weeks, MSBHF's P/CF has been as high as 8.71 and as low as 5.72, with a median of 7.63.

These are only a few of the key metrics included in Mitsubishi's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, MSBHF looks like an impressive value stock at the moment.


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