Is NGL Energy Partners LP (NGL) 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 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is NGL Energy Partners LP (NGL). NGL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 16.16 right now. For comparison, its industry sports an average P/E of 16.55. Over the past 52 weeks, NGL's Forward P/E has been as high as 4,686.95 and as low as -46,231.66, with a median of 20.41.
We should also highlight that NGL has a P/B ratio of 0.86. Investors use the P/B ratio to look at a stock's market value versus 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 2.20. NGL's P/B has been as high as 0.90 and as low as 0.50, with a median of 0.78, over the past year.
Finally, we should also recognize that NGL has a P/CF ratio of 3.36. 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. NGL's P/CF compares to its industry's average P/CF of 8.48. NGL's P/CF has been as high as 26.16 and as low as 1.98, with a median of 3.16, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that NGL Energy Partners LP is likely undervalued currently. And when considering the strength of its earnings outlook, NGL sticks out at as one of the market's strongest value stocks.
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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.