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Are Investors Undervaluing Medallion Financial (MFIN) Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

One company value investors might notice is Medallion Financial (MFIN - Free Report) . MFIN is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 5.13. This compares to its industry's average Forward P/E of 7.75. Over the past 52 weeks, MFIN's Forward P/E has been as high as 7.31 and as low as 3.34, with a median of 4.86.

Another valuation metric that we should highlight is MFIN's P/B ratio of 0.45. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. MFIN's current P/B looks attractive when compared to its industry's average P/B of 0.79. Within the past 52 weeks, MFIN's P/B has been as high as 0.68 and as low as 0.40, with a median of 0.53.

Finally, our model also underscores that MFIN has a P/CF ratio of 2.43. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. MFIN's P/CF compares to its industry's average P/CF of 8.55. Over the past 52 weeks, MFIN's P/CF has been as high as 3.87 and as low as 1.90, with a median of 2.67.

These are just a handful of the figures considered in Medallion Financial'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 MFIN is an impressive value stock right now.


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