Everyone loves a bargain. Be it at the grocery store, the local flea market, or the neighborhood car dealership, people inherently understand the benefits of getting a great deal.

Yet despite this infatuation with bargain opportunities, it doesn't occur to many investors that buying cheap stocks is possibly the best way to squeeze a whole lot of bang out of a hard-earned buck. As legendary investor Christopher H. Browne writes in The Little Book of Value Investing, we should always attempt to "buy stocks like steaks ... on sale."

Our penny-pinching process
So, with the help of our community over at Motley Fool CAPS, I'll once again try to find some cheap stocks for all of my stingy kindred spirits.

The approach is far from complicated: We'll run a simple screen for five-star stocks (the highest rating a stock can get in CAPS) that have enterprise value-to-EBITDA (EV/EBITDA) multiples of less than 10. We'll use EV/EBITDA rather than the more common price-to-earnings ratio so that we can account for differences in each company's capital structure.

Dive into the bargain bin
By running this screen, we'll zero in on statistically cheap stocks that, according to our CAPS community, have plenty of great reasons to trade at much higher levels.

So without further ado, let's dive right in this week's bargain bin.  

Company

EV/EBITDA (TTM)

Industry

Compania Cervecerias Unidas (NYSE:CU)

9.5

Beverages

Inter Parfums (NASDAQ:IPAR)

8.7

Personal products

Xyratex (NASDAQ:XRTX)

8.5

Data storage devices

Insteel Industries (NASDAQ:IIIN)

6.7

Steel and iron

Miller Industries (NYSE:MLR)

5.2

Auto parts

Data provided by Capital IQ, a division of Standard & Poor's.

As usual, our list isn't exactly brimming with exciting or even well-recognized names. But that should be just fine with us. As sharp Fools know well, boring stories often translate into the market's biggest returns.

Miller's time?
For value investors, nothing's sweeter than when the shares of an industry-leading business suffer a nasty, seemingly unwarranted haircut. While a plummeting stock in itself doesn't automatically warrant a buy, it's often a pretty profitable place to start looking. On Aug. 7, Miller Industries, a small-cap producer of towing equipment, piqued the interest of many investors in our community when its stock spiraled down by a heartbreaking 25%.

The shares have yet to recover -- in fact, it's down another 5% since -- but according to several CAPS Fools, it's simply a matter of time before Miller bounces back. Let's take a closer look, shall we?    

Despite a market cap of $205 million and virtually nonexistent analyst coverage, Miller happens to be the world's largest producer of vehicle towing and recovery equipment. Naturally, this doesn't exactly sound like the sexiest business to be in, but a quick glance at Miller's financials shows that it really isn't a bad business to be in, either. In each of the past three years, Miller has generated returns on capital of roughly 20%, and it has grown cash flow from operations at a compounded rate of 49% over that period.    

Of course, it's the future that counts with investing, which is exactly why Mr. Market has recently soured on the stock. Though Miller reported second-quarter revenue and pre-tax income growth of 18.4% and 20.4%, respectively, Co-CEO Jeffrey Badgley depressed investors by forecasting lower sales for the rest of 2007. Badgley cited a lack of additional follow-on orders and general concerns about the economy as the primary reasons for his bearishness.

Sure, the short-term prospects for Miller aren't exceptionally bright, but for investors willing to take a longer-term horizon, there are a few good reasons why Miller should at least make it to the watch list.

For one thing, Chairman and Co-CEO William G. Miller continues to own roughly 12% of the company -- something we Fools always like to see. More importantly, though, is that MLR has a rock-solid balance sheet with a measly debt-to-equity ratio of 5.1%.

Betting on a turnaround is always a tricky proposition, but at the very least, you'd like to see a history of strong financial performance, heavy insider ownership, and a solid financial position to help survive any extended slowdown -- all of which are characteristics that Miller Industries exhibits.  

Now, let's hear from a pair of bargain hunters in our own backyard ...
GunnarVagotis is among many CAPS Fools who don't agree with Mr. Market on this one:

On a day where almost anything is working, this stock is down 28% on not-great-but-still-decent earnings report. Anyway, they paid a lot into taxes compared to last year. But sales, margins, etc. all look fine on this stock. I don't see anything in the numbers to indicate that a 30% pullback is warranted.

And CAPS player WeeValue sums it all up:

This one seems to have a high probability of success. I would not be surprised to see Miller drift a little lower until the short term order dip is filled. In the event that a business slump is prolonged, I imagine that the capital upgrades could be delayed and the balance sheet is strong enough to weather the storm.

A Fool's final word
As always, what we say here isn't meant to be taken as a formal recommendation; we want only to generate some possible ideas that you might find worth further research. Want to scour the bargain bin for yourself, read what our CAPS community thinks, or even chime in with your own opinions? Get in the game.

Oh, and it's totally free -- an offer that even the deepest of value investors should never pass up.

Fool contributor Brian Pacampara has been tracking the stocks used in this column. Currently, TheFrugals are ranked 315 out of more than 60,000 portfolios. Brian owns no position in any of the stocks mentioned. The Fool's disclosure policy always pays the full price for transparency.