Yahoo Finance Are Investors Undervaluing DAQO New Energy (DQ) 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 company to watch right now is DAQO New Energy (DQ). DQ is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. DQ has a P/S ratio of 0.73. This compares to its industry's average P/S of 1.76.
Finally, investors should note that DQ has a P/CF ratio of 3.57. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 9.73. Over the past year, DQ's P/CF has been as high as 3.89 and as low as 1.70, with a median of 2.39.
These figures are just a handful of the metrics value investors tend to look at, but they help show that DAQO New Energy is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, DQ feels like a great value stock at the moment.
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
DAQO New Energy Corp. (DQ) : Free Stock Analysis Report
