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Should Value Investors Consider Aegean Marine Stock?

Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn't want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?

One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let's put Aegean Marine Petroleum Network Inc.ANW stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:

PE Ratio

A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock's current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.

On this front, Aegean Marine has a trailing twelve months PE ratio of 9.06, as you can see in the chart below:

This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 19.86. If we focus on the long-term PE trend, Aegean Marine's current PE level puts it below its midpoint, over the past five years. Moreover, the current level is fairly below the highs for this stock, suggesting that the stock is undervalued compared to its historical levels.

Further, the stock's PE also compares favorably with the Zacks classified Transportation-Ship industry's trailing twelve months PE ratio, which stands at 18.52. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.

We should also point out that Aegean Marine has a forward PE ratio (price relative to this year's earnings) of just 6.74, so it is fair to say that a slightly more value-oriented path may be ahead for Aegean Marine stock in the near term too.

P/S Ratio

Another key metric to note is the Price/Sales ratio. This approach compares a given stock's price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.

Right now, Aegean Marine has a P/S ratio of 0.13. This is significantly lower than the S&P 500 average, which comes in at 2.97 right now. However, as we can see in the chart below, this is around the highs for this stock in particular over the past few years.

If anything, ANW is towards the higher end of its range in the time period from a P/S metric, which suggests that the company's stock price has already appreciated to some degree, relative to its sales.

Broad Value Outlook

In aggregate, Aegean Marine currently has a Zacks Value Style Score of 'A', putting it into the top 20% of all stocks we cover from this look. This makes Aegean Marine a solid choice for value investors.

What About the Stock Overall?

Though Aegean Marine might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of 'A' and a Momentum score of 'B'. This gives ANW a Zacks VGM score-or its overarching fundamental grade-of 'A'. (You can read more about the Zacks Style Scores here >> )

Meanwhile, the company's recent earnings estimates have been mostly encouraging. The current quarter has seen one estimates go higher in the past sixty days compared to none lower, while the full year estimate has seen two upward revisions and no downward revision in the same time period.

This has had a meaningful impact on the consensus estimate as the consensus estimate for the current quarter consensus estimate has risen by 8.3% in the past two months, while the full year estimate has inched higher by 4.8%. You can see the consensus estimate trend and recent price action for the stock in the chart below:

Aegean Marine Petroleum Network Inc. Price and Consensus

Aegean Marine Petroleum Network Inc. Price and Consensus | Aegean Marine Petroleum Network Inc. Quote

However, this positive trend has likely not yet been reflected in the stock, as we have just a Zacks Rank #3 (Hold), which indicates expectations of in-line performance in the near term. However, the definite bullish analyst sentiment indicates that the stock's growth story is intact.

Bottom Line

Aegean Marine is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. However, with a sluggish industry rank (bottom 22%) and a Zacks Rank #3, it is hard to get too excited about this company overall. In fact, over the past two years, the Zacks Transportation-Ship industry has clearly underperformed the broader market, as you can see below:

So, it might pay for value investors to delve deeper into the company's prospects, as fundamentals indicate that this stock could be a compelling pick.

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Aegean Marine Petroleum Network Inc. (ANW): Free Stock Analysis Report

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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.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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