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Are Investors Undervaluing Matthews International (MATW) Right Now?

Zacks Equity Research
·2-min read

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.

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.

Matthews International (MATW) is a stock many investors are watching right now. MATW is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 6.75 right now. For comparison, its industry sports an average P/E of 16.52. Over the past 52 weeks, MATW's Forward P/E has been as high as 11.39 and as low as 5.49, with a median of 9.17.

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Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MATW has a P/S ratio of 0.38. This compares to its industry's average P/S of 1.03.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Matthews International is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MATW feels like a great value stock at the moment.


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Zacks Investment Research