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Are Investors Undervaluing Teekay Tankers (TNK) Right Now?

Zacks Equity Research
·2 min read

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 Teekay Tankers (TNK). TNK is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Investors should also recognize that TNK has a P/B ratio of 0.72. The P/B is a method of comparing a stock's market value to 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 0.86. Within the past 52 weeks, TNK's P/B has been as high as 0.88 and as low as 0.28, with a median of 0.44.

Finally, investors should note that TNK has a P/CF ratio of 5.02. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 7.95. Over the past year, TNK's P/CF has been as high as 7.28 and as low as 2.35, with a median of 3.35.

These are only a few of the key metrics included in Teekay Tankers's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, TNK looks like an impressive value stock at the moment.


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