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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 company value investors might notice is Great Lakes Dredge & Dock (GLDD). GLDD is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock holds a P/E ratio of 11.99, while its industry has an average P/E of 22.36. Over the last 12 months, GLDD's Forward P/E has been as high as 15.23 and as low as 9.59, with a median of 12.40.
GLDD is also sporting a PEG ratio of 1.00. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GLDD's PEG compares to its industry's average PEG of 1.40. Over the last 12 months, GLDD's PEG has been as high as 1.20 and as low as 0.27, with a median of 0.41.
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. GLDD has a P/S ratio of 0.91. This compares to its industry's average P/S of 0.96.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Great Lakes Dredge & Dock is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GLDD feels like a great value stock at the moment.
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Great Lakes Dredge & Dock Corporation (GLDD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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