Is Danaos (DAC) Stock Undervalued Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company value investors might notice is Danaos (DAC). DAC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 2.45 right now. For comparison, its industry sports an average P/E of 5.82. Over the last 12 months, DAC's Forward P/E has been as high as 2.74 and as low as 1.88, with a median of 2.20.
We should also highlight that DAC has a P/B ratio of 0.53. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.12. DAC's P/B has been as high as 0.68 and as low as 0.41, with a median of 0.47, over the past year.
Finally, investors will want to recognize that DAC has a P/CF ratio of 2.93. 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 3.12. Over the past year, DAC's P/CF has been as high as 2.98 and as low as 1.37, with a median of 1.78.
Another great Transportation - Shipping stock you could consider is Teekay Tankers (TNK), which is a # 1 (Strong Buy) stock with a Value Score of A.
Shares of Teekay Tankers are currently trading at a forward earnings multiple of 4.49 and a PEG ratio of 1.50 compared to its industry's P/E and PEG ratios of 5.82 and 0.33, respectively.
Over the last 12 months, TNK's P/E has been as high as 49.61, as low as 1.98, with a median of 4.13, and its PEG ratio has been as high as 16.54, as low as 0.66, with a median of 1.38.
Additionally, Teekay Tankers has a P/B ratio of 1.11 while its industry's price-to-book ratio sits at 1.12. For TNK, this valuation metric has been as high as 1.51, as low as 0.85, with a median of 1.09 over the past year.
These are just a handful of the figures considered in Danaos and Teekay Tankers'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 TNK is an impressive value stock right now.
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Danaos Corporation (DAC) : Free Stock Analysis Report
Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
