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Should Value Investors Buy MGIC Investment (MTG) Stock?
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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company to watch right now is MGIC Investment (MTG - Free Report) . MTG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 5.60 right now. For comparison, its industry sports an average P/E of 10.06. MTG's Forward P/E has been as high as 8.56 and as low as 5.06, with a median of 6.16, all within the past year.
MTG is also sporting a PEG ratio of 1.12. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. MTG's industry currently sports an average PEG of 1.66. MTG's PEG has been as high as 1.71 and as low as 1.01, with a median of 1.23, all within the past year.
Finally, investors will want to recognize that MTG has a P/CF ratio of 4.40. 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. MTG's current P/CF looks attractive when compared to its industry's average P/CF of 10. Over the past 52 weeks, MTG's P/CF has been as high as 7.99 and as low as 4.20, with a median of 5.82.
Investors could also keep in mind Radian Group (RDN - Free Report) , an Insurance - Multi line stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shares of Radian Group currently holds a Forward P/E ratio of 5.61, and its PEG ratio is 1.12. In comparison, its industry sports average P/E and PEG ratios of 10.06 and 1.66.
RDN's Forward P/E has been as high as 7.75 and as low as 5.53, with a median of 6.41. During the same time period, its PEG ratio has been as high as 1.55, as low as 1.11, with a median of 1.28.
Radian Group sports a P/B ratio of 0.79 as well; this compares to its industry's price-to-book ratio of 2.92. In the past 52 weeks, RDN's P/B has been as high as 1.04, as low as 0.76, with a median of 0.91.
Value investors will likely look at more than just these metrics, but the above data helps show that MGIC Investment and Radian Group are likely undervalued currently. And when considering the strength of its earnings outlook, MTG and RDN sticks out as one of the market's strongest value stocks.
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Should Value Investors Buy MGIC Investment (MTG) Stock?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company to watch right now is MGIC Investment (MTG - Free Report) . MTG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 5.60 right now. For comparison, its industry sports an average P/E of 10.06. MTG's Forward P/E has been as high as 8.56 and as low as 5.06, with a median of 6.16, all within the past year.
MTG is also sporting a PEG ratio of 1.12. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. MTG's industry currently sports an average PEG of 1.66. MTG's PEG has been as high as 1.71 and as low as 1.01, with a median of 1.23, all within the past year.
Finally, investors will want to recognize that MTG has a P/CF ratio of 4.40. 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. MTG's current P/CF looks attractive when compared to its industry's average P/CF of 10. Over the past 52 weeks, MTG's P/CF has been as high as 7.99 and as low as 4.20, with a median of 5.82.
Investors could also keep in mind Radian Group (RDN - Free Report) , an Insurance - Multi line stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shares of Radian Group currently holds a Forward P/E ratio of 5.61, and its PEG ratio is 1.12. In comparison, its industry sports average P/E and PEG ratios of 10.06 and 1.66.
RDN's Forward P/E has been as high as 7.75 and as low as 5.53, with a median of 6.41. During the same time period, its PEG ratio has been as high as 1.55, as low as 1.11, with a median of 1.28.
Radian Group sports a P/B ratio of 0.79 as well; this compares to its industry's price-to-book ratio of 2.92. In the past 52 weeks, RDN's P/B has been as high as 1.04, as low as 0.76, with a median of 0.91.
Value investors will likely look at more than just these metrics, but the above data helps show that MGIC Investment and Radian Group are likely undervalued currently. And when considering the strength of its earnings outlook, MTG and RDN sticks out as one of the market's strongest value stocks.