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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.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company value investors might notice is Delek US Holdings (DK - Free Report) . DK is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

We also note that DK holds a PEG ratio of 0.61. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DK's PEG compares to its industry's average PEG of 0.67. Within the past year, DK's PEG has been as high as 0.61 and as low as 0.22, with a median of 0.31.

Another notable valuation metric for DK is its P/B ratio of 1.55. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. DK's current P/B looks attractive when compared to its industry's average P/B of 2.01. Over the past year, DK's P/B has been as high as 3.12 and as low as 1.11, with a median of 1.44.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. DK has a P/S ratio of 0.13. This compares to its industry's average P/S of 0.34.

Finally, we should also recognize that DK has a P/CF ratio of 3.75. 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. DK's P/CF compares to its industry's average P/CF of 4.94. Over the past 52 weeks, DK's P/CF has been as high as 126.69 and as low as 2.81, with a median of 15.69.

These are only a few of the key metrics included in Delek US Holdings'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, DK looks like an impressive value stock at the moment.


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