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Are Investors Undervaluing Great Lakes Dredge & Dock (GLDD) Right Now?

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Zacks Equity Research
·2 min read
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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.

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 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 Great Lakes Dredge & Dock (GLDD). GLDD is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 10.24, which compares to its industry's average of 12.96. Over the past 52 weeks, GLDD's Forward P/E has been as high as 17.31 and as low as 7.88, with a median of 13.11.

Finally, investors will want to recognize that GLDD has a P/CF ratio of 5.77. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 8. Over the past 52 weeks, GLDD's P/CF has been as high as 11.85 and as low as 4.67, with a median of 9.

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


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Zacks Investment Research