U.S. Markets open in 31 mins

Is EURODRY LTD (EDRY) Stock Undervalued Right Now?

Zacks Equity Research

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.

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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company to watch right now is EURODRY LTD (EDRY). EDRY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Another valuation metric that we should highlight is EDRY's P/B ratio of 0.44. 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 0.97. Within the past 52 weeks, EDRY's P/B has been as high as 0.67 and as low as 0.33, with a median of 0.41.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. EDRY has a P/S ratio of 0.7. This compares to its industry's average P/S of 1.14.

These figures are just a handful of the metrics value investors tend to look at, but they help show that EURODRY LTD is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, EDRY feels like a great value stock at the moment.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
EURODRY LTD (EDRY) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.