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Is The Marcus (MCS) Stock Undervalued Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 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.

The Marcus (MCS - Free Report) is a stock many investors are watching right now. MCS is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. MCS has a P/S ratio of 0.88. This compares to its industry's average P/S of 1.21.

Finally, our model also underscores that MCS has a P/CF ratio of 11.04. 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. MCS's P/CF compares to its industry's average P/CF of 16.88. Over the past 52 weeks, MCS's P/CF has been as high as 12.94 and as low as 3.93, with a median of 7.69.

Value investors will likely look at more than just these metrics, but the above data helps show that The Marcus is likely undervalued currently. And when considering the strength of its earnings outlook, MCS sticks out at as one of the market's strongest value stocks.


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