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Is Delek US Holdings (DK) Stock Undervalued Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Delek US Holdings (DK - Free Report) . DK is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with P/E ratio of 4.68 right now. For comparison, its industry sports an average P/E of 5.52. DK's Forward P/E has been as high as 129.51 and as low as -120.80, with a median of 9.98, all within the past year.

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. DK has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.3.

Finally, investors will want to recognize that DK has a P/CF ratio of 3.08. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 4.68. Over the past year, DK's P/CF has been as high as 27.01 and as low as -41.18, with a median of 3.15.

Investors could also keep in mind Valero Energy (VLO - Free Report) , an Oil and Gas - Refining and Marketing stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.

Valero Energy is currently trading with a Forward P/E ratio of 5.33 while its PEG ratio sits at 0.89. Both of the company's metrics compare favorably to its industry's average P/E of 5.52 and average PEG ratio of 0.20.

Over the last 12 months, VLO's P/E has been as high as 57.89, as low as 4.97, with a median of 12.09, and its PEG ratio has been as high as 12.91, as low as 0.83, with a median of 2.10.

Valero Energy sports a P/B ratio of 1.94 as well; this compares to its industry's price-to-book ratio of 1.87. In the past 52 weeks, VLO's P/B has been as high as 2.90, as low as 1.32, with a median of 1.76.

These are just a handful of the figures considered in Delek US Holdings and Valero Energy'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 DK and VLO is an impressive value stock right now.


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