by default Magento (Community 1.7.0.2) out of stock display option is not

example

[General]

my product name : test item

status: enabled

visible: catalog and search

[Inventory]

quantity: 5

but the stock availability: Out of Stock

in the admin panel go to the [System] tab

< Catalog > section

click the ( Inventory )

make the Display Out of Stock Products option to Yes

thats it done..

ou also need run the index management and cache management

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