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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
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.
Great Lakes Dredge & Dock (GLDD) is a stock many investors are watching right now. GLDD is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.53, while its industry has an average P/E of 21.24. 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 0.96. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. GLDD's industry currently sports an average PEG of 1.30. Within the past year, GLDD's PEG has been as high as 1.20 and as low as 0.27, with a median of 0.93.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GLDD has a P/S ratio of 0.97. This compares to its industry's average P/S of 1.01.
These are only a few of the key metrics included in Great Lakes Dredge & Dock'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, GLDD looks like an impressive 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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