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Are Investors Undervaluing Mazda Motor Corporation (MZDAY) Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Mazda Motor Corporation (MZDAY - Free Report) . MZDAY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We should also highlight that MZDAY has a P/B ratio of 0.38. The P/B ratio pits a stock's market value against 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 0.83. Over the past year, MZDAY's P/B has been as high as 0.59 and as low as 0.25, with a median of 0.47.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. MZDAY has a P/S ratio of 0.13. This compares to its industry's average P/S of 0.34.

Finally, our model also underscores that MZDAY has a P/CF ratio of 3.28. 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 4.53. Over the past year, MZDAY's P/CF has been as high as 5.52 and as low as 2.18, with a median of 4.24.

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


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