Yahoo Finance Are Investors Undervaluing NGL Energy Partners (NGL) Right Now?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
NGL Energy Partners (NGL) is a stock many investors are watching right now. NGL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Another notable valuation metric for NGL is its P/B ratio of 1.51. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. NGL's current P/B looks attractive when compared to its industry's average P/B of 4.39. Over the past year, NGL's P/B has been as high as 1.58 and as low as 0.72, with a median of 1.17.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. NGL has a P/S ratio of 0.1. This compares to its industry's average P/S of 0.27.
Finally, our model also underscores that NGL has a P/CF ratio of 2.24. 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 stock's P/CF looks attractive against its industry's average P/CF of 8.33. NGL's P/CF has been as high as 2.32 and as low as 0.98, with a median of 1.50, all within the past year.
These are only a few of the key metrics included in NGL Energy Partners'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, NGL looks like an impressive 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
NGL Energy Partners LP (NGL) : Free Stock Analysis Report
