Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
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.
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 company value investors might notice is Great Lakes Dredge & Dock (GLDD). GLDD is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.97, while its industry has an average P/E of 21.12. 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.
We also note that GLDD holds a PEG ratio of 1.00. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GLDD's industry currently sports an average PEG of 1.33. GLDD's PEG has been as high as 1.20 and as low as 0.27, with a median of 0.95, all within the past year.
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 1.1. This compares to its industry's average P/S of 1.14.
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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