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Is Matson (MATX) a Great Value Stock Right Now?

Zacks Equity Research
·3 min read

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Matson (MATX). MATX is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 16.77. This compares to its industry's average Forward P/E of 24.38. Over the last 12 months, MATX's Forward P/E has been as high as 28.13 and as low as 12.74, with a median of 18.84.

Another valuation metric that we should highlight is MATX's P/B ratio of 2.77. 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. This company's current P/B looks solid when compared to its industry's average P/B of 3.94. MATX's P/B has been as high as 2.97 and as low as 1.34, with a median of 1.97, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MATX has a P/S ratio of 1.1. This compares to its industry's average P/S of 1.2.

Finally, investors should note that MATX has a P/CF ratio of 7.15. 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 20.68. Over the past year, MATX's P/CF has been as high as 9.71 and as low as 4.04, with a median of 5.87.

These are just a handful of the figures considered in Matson's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that MATX is an impressive value stock right now.


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