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Is MarineMax (HZO) a Great Value Stock Right Now?

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...

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This story originally appeared on Zacks

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.

- Zacks

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 to watch right now is MarineMax (HZO). HZO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 7.80. This compares to its industry's average Forward P/E of 16.94. HZO's Forward P/E has been as high as 14 and as low as 7.04, with a median of 8.93, all within the past year.

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. HZO has a P/S ratio of 0.55. This compares to its industry's average P/S of 0.71.

Finally, investors will want to recognize that HZO has a P/CF ratio of 7.30. 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. HZO's current P/CF looks attractive when compared to its industry's average P/CF of 20.66. Within the past 12 months, HZO's P/CF has been as high as 13.67 and as low as 6.49, with a median of 8.17.

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



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