Should Value Investors Buy Eagle Bulk Shipping (EGLE) Stock?
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.
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.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Eagle Bulk Shipping (EGLE). EGLE is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is EGLE's P/B ratio of 0.96. 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 1.12. Within the past 52 weeks, EGLE's P/B has been as high as 1.50 and as low as 0.72, with a median of 0.91.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. EGLE has a P/S ratio of 1.03. This compares to its industry's average P/S of 1.11.
Finally, investors will want to recognize that EGLE has a P/CF ratio of 2.31. 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 stock's P/CF looks attractive against its industry's average P/CF of 2.96. EGLE's P/CF has been as high as 4.13 and as low as 1.69, with a median of 2.14, all within the past year.
If you're looking for another solid Transportation - Shipping value stock, take a look at Safe Bulkers (SB). SB is a # 1 (Strong Buy) stock with a Value score of A.
Safe Bulkers also has a P/B ratio of 0.54 compared to its industry's price-to-book ratio of 1.12. Over the past year, its P/B ratio has been as high as 0.87, as low as 0.40, with a median of 0.63.
These are only a few of the key metrics included in Eagle Bulk Shipping and Safe Bulkers strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, EGLE and SB look like an impressive value stock at the moment.
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Eagle Bulk Shipping Inc. (EGLE) : Free Stock Analysis Report
Safe Bulkers, Inc (SB) : Free Stock Analysis Report
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