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Is Mayville Engineering (MEC) Stock Undervalued 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.

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

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Mayville Engineering (MEC - Free Report) is a stock many investors are watching right now. MEC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 14.43, which compares to its industry's average of 19.21. Over the past year, MEC's Forward P/E has been as high as 18.57 and as low as 5.40, with a median of 13.55.

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. MEC has a P/S ratio of 0.43. This compares to its industry's average P/S of 0.89.

These are only a few of the key metrics included in Mayville Engineering's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, MEC looks like an impressive value stock at the moment.


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