Are Investors Undervaluing Daktronics (DAKT) Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Daktronics (DAKT). DAKT is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 19.28, which compares to its industry's average of 26.02. Over the past year, DAKT's Forward P/E has been as high as 20.96 and as low as 11.24, with a median of 14.60.
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. DAKT has a P/S ratio of 1.31. This compares to its industry's average P/S of 1.87.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Daktronics is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, DAKT feels like a great value stock at the moment.
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Daktronics, Inc. (DAKT): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
