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Are Investors Undervaluing Meta Financial (CASH) Right Now?

Zacks Equity Research

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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Meta Financial (CASH). CASH is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 8.55, which compares to its industry's average of 11.61. Over the last 12 months, CASH's Forward P/E has been as high as 13.26 and as low as 6.58, with a median of 8.73.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CASH has a P/S ratio of 2.31. This compares to its industry's average P/S of 2.96.

Finally, investors will want to recognize that CASH has a P/CF ratio of 9.70. 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. This stock's P/CF looks attractive against its industry's average P/CF of 10.03. Within the past 12 months, CASH's P/CF has been as high as 10.96 and as low as 6.84, with a median of 9.17.

These are only a few of the key metrics included in Meta Financial'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, CASH looks like an impressive value stock at the moment.


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