Is On Deck Capital (ONDK) Stock Undervalued Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
On Deck Capital (ONDK) is a stock many investors are watching right now. ONDK is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.
Another notable valuation metric for ONDK is its P/B ratio of 1.02. The P/B is a method of comparing a stock's market value to 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 1.57. Over the past year, ONDK's P/B has been as high as 2.02 and as low as 0.73, with a median of 1.11.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ONDK has a P/S ratio of 0.69. This compares to its industry's average P/S of 1.62.
Finally, investors should note that ONDK has a P/CF ratio of 2.97. 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. ONDK's P/CF compares to its industry's average P/CF of 8.16. Over the past 52 weeks, ONDK's P/CF has been as high as 7.16 and as low as 2.14, with a median of 3.24.
Value investors will likely look at more than just these metrics, but the above data helps show that On Deck Capital is likely undervalued currently. And when considering the strength of its earnings outlook, ONDK sticks out at as one of the market's strongest value stocks.
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