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Is Mistras (MG) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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.

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 stock to keep an eye on is Mistras (MG). MG is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 17.19. This compares to its industry's average Forward P/E of 20.70. Over the past 52 weeks, MG's Forward P/E has been as high as 56.10 and as low as 15.30, with a median of 30.78.

Investors should also note that MG holds a PEG ratio of 0.99. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MG's PEG compares to its industry's average PEG of 1.63. Over the last 12 months, MG's PEG has been as high as 3.01 and as low as 0.92, with a median of 1.39.

Finally, investors should note that MG has a P/CF ratio of 8.98. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. MG's current P/CF looks attractive when compared to its industry's average P/CF of 18.68. Over the past year, MG's P/CF has been as high as 12.47 and as low as -5.48, with a median of 7.72.

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


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