Should Value Investors Buy Danaos (DAC) Stock?
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.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Danaos (DAC). DAC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 2.17, which compares to its industry's average of 5.68. DAC's Forward P/E has been as high as 2.49 and as low as 1.88, with a median of 2.20, all within the past year.
We should also highlight that DAC has a P/B ratio of 0.48. 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 solid versus its industry's average P/B of 1.12. DAC's P/B has been as high as 0.62 and as low as 0.41, with a median of 0.47, over the past year.
Finally, our model also underscores that DAC has a P/CF ratio of 2.07. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 3.36. DAC's P/CF has been as high as 2.80 and as low as 1.37, with a median of 1.82, all within the past year.
Another great Transportation - Shipping stock you could consider is Teekay Tankers (TNK), which is a # 2 (Buy) stock with a Value Score of A.
Shares of Teekay Tankers are currently trading at a forward earnings multiple of 4.03 and a PEG ratio of 1.34 compared to its industry's P/E and PEG ratios of 5.68 and 0.32, respectively.
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Danaos Corporation (DAC) : Free Stock Analysis Report
Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
