Is Teekay Tankers (TNK) Stock Undervalued Right Now?
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.
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.
Teekay Tankers (TNK) is a stock many investors are watching right now. TNK is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 4.34, which compares to its industry's average of 6.02. Over the past 52 weeks, TNK's Forward P/E has been as high as 7.12 and as low as 3.29, with a median of 4.23.
We should also highlight that TNK has a P/B ratio of 1.20. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. TNK's current P/B looks attractive when compared to its industry's average P/B of 1.36. TNK's P/B has been as high as 1.50 and as low as 0.91, with a median of 1.11, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. TNK has a P/S ratio of 1.33. This compares to its industry's average P/S of 1.35.
Finally, we should also recognize that TNK has a P/CF ratio of 3.05. 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. TNK's current P/CF looks attractive when compared to its industry's average P/CF of 7.19. TNK's P/CF has been as high as 4.98 and as low as 2.02, with a median of 2.64, all within the past year.
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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Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
