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Is Dana (DAN) a Great Value Stock Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

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.

Dana (DAN - Free Report) is a stock many investors are watching right now. DAN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 5.48. This compares to its industry's average Forward P/E of 10.39. Over the past 52 weeks, DAN's Forward P/E has been as high as 11.95 and as low as 4.07, with a median of 6.62.

Investors should also recognize that DAN has a P/B ratio of 1.88. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.55. Over the past 12 months, DAN's P/B has been as high as 4.34 and as low as 1.38, with a median of 2.36.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. DAN has a P/S ratio of 0.32. This compares to its industry's average P/S of 0.4.

Finally, investors will want to recognize that DAN has a P/CF ratio of 5.49. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. DAN's current P/CF looks attractive when compared to its industry's average P/CF of 6.22. Over the past year, DAN's P/CF has been as high as 14.36 and as low as 4.01, with a median of 6.77.

These are just a handful of the figures considered in Dana's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that DAN is an impressive value stock right now.


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