Should Value Investors Buy Euroseas (ESEA) 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 Euroseas (ESEA). ESEA is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 2.30. This compares to its industry's average Forward P/E of 5.80. Over the past year, ESEA's Forward P/E has been as high as 2.30 and as low as 0.95, with a median of 1.29.
Another valuation metric that we should highlight is ESEA's P/B ratio of 0.81. The P/B ratio pits a stock's market value against 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. ESEA's P/B has been as high as 1.47 and as low as 0.64, with a median of 0.83, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ESEA has a P/S ratio of 0.97. This compares to its industry's average P/S of 1.08.
Finally, we should also recognize that ESEA has a P/CF ratio of 1.58. 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. This stock's P/CF looks attractive against its industry's average P/CF of 3.10. Over the past year, ESEA's P/CF has been as high as 1.94 and as low as 1.06, with a median of 1.24.
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 4.31 and a PEG ratio of 1.44 compared to its industry's P/E and PEG ratios of 5.80 and 0.33, respectively.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Euroseas Ltd. (ESEA) : Free Stock Analysis Report
Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
