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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Danaos (DAC). DAC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 2.27, which compares to its industry's average of 4.80. Over the past 52 weeks, DAC's Forward P/E has been as high as 3.15 and as low as 1.88, with a median of 2.28.
Another valuation metric that we should highlight is DAC's P/B ratio of 0.46. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.08. DAC's P/B has been as high as 0.76 and as low as 0.41, with a median of 0.49, over the past year.
Finally, investors should note that DAC has a P/CF ratio of 1.75. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. DAC's current P/CF looks attractive when compared to its industry's average P/CF of 2.92. Over the past year, DAC's P/CF has been as high as 1.96 and as low as 1.07, with a median of 1.68.
GasLog Partners (GLOP) may be another strong Transportation - Shipping stock to add to your shortlist. GLOP is a # 1 (Strong Buy) stock with a Value grade of A.
Furthermore, GasLog Partners holds a P/B ratio of 0.66 and its industry's price-to-book ratio is 1.08. GLOP's P/B has been as high as 0.71, as low as 0.38, with a median of 0.54 over the past 12 months.
These are just a handful of the figures considered in Danaos and GasLog Partners's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that DAC and GLOP is an impressive value stock right now.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
