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Should Value Investors Buy Marubeni (MARUY) 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is Marubeni (MARUY - Free Report) . MARUY is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 10.93. This compares to its industry's average Forward P/E of 14.25. Over the past year, MARUY's Forward P/E has been as high as 11.91 and as low as 7.26, with a median of 8.39.

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. MARUY has a P/S ratio of 0.81. This compares to its industry's average P/S of 1.46.

Finally, our model also underscores that MARUY has a P/CF ratio of 8.48. 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 stock's P/CF looks attractive against its industry's average P/CF of 18.95. Within the past 12 months, MARUY's P/CF has been as high as 8.48 and as low as 4.91, with a median of 6.19.

Value investors will likely look at more than just these metrics, but the above data helps show that Marubeni is likely undervalued currently. And when considering the strength of its earnings outlook, MARUY sticks out as one of the market's strongest value stocks.


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