Are Investors Undervaluing Meritage Hospitality Group (MHGU) Right Now?
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, 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 Meritage Hospitality Group (MHGU). MHGU 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 11.43. This compares to its industry's average Forward P/E of 25.27. Over the past year, MHGU's Forward P/E has been as high as 19.79 and as low as 11.18, with a median of 15.57.
Finally, investors will want to recognize that MHGU has a P/CF ratio of 5.59. 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. MHGU's P/CF compares to its industry's average P/CF of 22.17. Over the past 52 weeks, MHGU's P/CF has been as high as 6.44 and as low as 4.90, with a median of 5.80.
These are only a few of the key metrics included in Meritage Hospitality Group'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, MHGU looks like an impressive value stock at the moment.
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Meritage Hospitality Group Inc. (MHGU) : Free Stock Analysis Report