Back to top

Image: Bigstock

MCFT vs. POOL: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors with an interest in Leisure and Recreation Products stocks have likely encountered both MCBC Holdings (MCFT - Free Report) and Pool Corp. (POOL - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Right now, MCBC Holdings is sporting a Zacks Rank of #1 (Strong Buy), while Pool Corp. has a Zacks Rank of #2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that MCFT has an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

MCFT currently has a forward P/E ratio of 11.23, while POOL has a forward P/E of 25.87. We also note that MCFT has a PEG ratio of 0.75. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. POOL currently has a PEG ratio of 1.10.

Another notable valuation metric for MCFT is its P/B ratio of 10.56. 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. By comparison, POOL has a P/B of 15.74.

These are just a few of the metrics contributing to MCFT's Value grade of B and POOL's Value grade of C.

MCFT stands above POOL thanks to its solid earnings outlook, and based on these valuation figures, we also feel that MCFT is the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Pool Corporation (POOL) - free report >>

MASTERCRAFT BOAT HOLDINGS, INC. (MCFT) - free report >>

Published in