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Is Matador Resources (MTDR) 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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Matador Resources (MTDR - Free Report) . MTDR is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 7.10, while its industry has an average P/E of 10.32. Over the past 52 weeks, MTDR's Forward P/E has been as high as 9.96 and as low as 5.63, with a median of 7.53.

Another valuation metric that we should highlight is MTDR's P/B ratio of 1.66. Investors use the P/B ratio to look at a stock's market value versus 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 2.48. MTDR's P/B has been as high as 2.13 and as low as 1.50, with a median of 1.77, over the past year.

Finally, we should also recognize that MTDR has a P/CF ratio of 4.39. 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. MTDR's P/CF compares to its industry's average P/CF of 7.83. Over the past year, MTDR's P/CF has been as high as 5.42 and as low as 3.97, with a median of 4.63.

SM Energy (SM - Free Report) may be another strong Oil and Gas - Exploration and Production - United States stock to add to your shortlist. SM is a # 1 (Strong Buy) stock with a Value grade of A.

SM Energy also has a P/B ratio of 1.40 compared to its industry's price-to-book ratio of 2.48. Over the past year, its P/B ratio has been as high as 1.64, as low as 1.14, with a median of 1.40.

These are only a few of the key metrics included in Matador Resources and SM Energy strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, MTDR and SM look like an impressive value stock at the moment.


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