Is Danaos (DAC) Stock Undervalued 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 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.
One stock to keep an eye on is Danaos (DAC). DAC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 4.46, which compares to its industry's average of 5.27. Over the past year, DAC's Forward P/E has been as high as 5.30 and as low as 1.04, with a median of 3.62.
We should also highlight that DAC has a P/B ratio of 0.98. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.08. Within the past 52 weeks, DAC's P/B has been as high as 1.19 and as low as 0.18, with a median of 0.80.
Finally, investors should note that DAC has a P/CF ratio of 1.90. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.68. Over the past 52 weeks, DAC's P/CF has been as high as 4.06 and as low as 0.65, with a median of 1.92.
These are just a handful of the figures considered in Danaos'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 is an impressive value stock right now.
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