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Is Mazda Motor (MZDAY) Stock Undervalued Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company to watch right now is Mazda Motor (MZDAY - Free Report) . MZDAY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 5.97. This compares to its industry's average Forward P/E of 8.95. Over the past 52 weeks, MZDAY's Forward P/E has been as high as 11.21 and as low as 5.37, with a median of 7.63.

Another notable valuation metric for MZDAY is its P/B ratio of 0.44. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 0.94. Over the past 12 months, MZDAY's P/B has been as high as 0.54 and as low as 0.36, with a median of 0.45.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. MZDAY has a P/S ratio of 0.2. This compares to its industry's average P/S of 0.51.

Finally, investors will want to recognize that MZDAY has a P/CF ratio of 3.38. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 4.48. MZDAY's P/CF has been as high as 4.49 and as low as 2.62, with a median of 3.36, all within the past year.

These are just a handful of the figures considered in Mazda Motor's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that MZDAY is an impressive value stock right now.


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