Are Investors Undervaluing Cinemark (CNK) 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 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.
Cinemark (CNK) is a stock many investors are watching right now. CNK is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 14.46 right now. For comparison, its industry sports an average P/E of 17.12. Over the past 52 weeks, CNK's Forward P/E has been as high as 66.86 and as low as -6.14, with a median of 18.58.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CNK has a P/S ratio of 0.66. This compares to its industry's average P/S of 0.78.
If you're looking for another solid Leisure and Recreation Services value stock, take a look at The Marcus (MCS). MCS is a # 2 (Buy) stock with a Value score of A.
The Marcus is trading at a forward earnings multiple of 62.85 at the moment, with a PEG ratio of 4.19. This compares to its industry's average P/E of 17.12 and average PEG ratio of 0.94.
MCS's price-to-earnings ratio has been as high as 78.30 and as low as -823.28, with a median of 37.39, while its PEG ratio has been as high as 5.22 and as low as -54.89, with a median of 2.49, all within the past year.
Furthermore, The Marcus holds a P/B ratio of 1.05 and its industry's price-to-book ratio is 3.06. MCS's P/B has been as high as 1.27, as low as 0.96, with a median of 1.07 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Cinemark and The Marcus are likely undervalued currently. And when considering the strength of its earnings outlook, CNK and MCS sticks out as one of the market's strongest value stocks.
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Cinemark Holdings Inc (CNK) : Free Stock Analysis Report
Marcus Corporation (The) (MCS) : Free Stock Analysis Report
