Is M.D.C. (MDC) a Great Value Stock Right Now?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
M.D.C. (MDC) is a stock many investors are watching right now. MDC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.
Another valuation metric that we should highlight is MDC's P/B ratio of 1.15. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. MDC's current P/B looks attractive when compared to its industry's average P/B of 1.44. Within the past 52 weeks, MDC's P/B has been as high as 1.20 and as low as 0.65, with a median of 0.87.
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. MDC has a P/S ratio of 0.7. This compares to its industry's average P/S of 0.76.
Meritage Homes (MTH) may be another strong Building Products - Home Builders stock to add to your shortlist. MTH is a # 1 (Strong Buy) stock with a Value grade of A.
Additionally, Meritage Homes has a P/B ratio of 1.27 while its industry's price-to-book ratio sits at 1.44. For MTH, this valuation metric has been as high as 1.30, as low as 0.66, with a median of 1 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that M.D.C. and Meritage Homes are likely undervalued currently. And when considering the strength of its earnings outlook, MDC and MTH sticks out as one of the market's strongest value stocks.
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M.D.C. Holdings, Inc. (MDC) : Free Stock Analysis Report
Meritage Homes Corporation (MTH) : Free Stock Analysis Report
