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Are Investors Undervaluing Scorpio Tankers (STNG) Right Now?

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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.

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.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Scorpio Tankers (STNG - Free Report) . STNG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We also note that STNG holds a PEG ratio of 0.20. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. STNG's industry has an average PEG of 0.35 right now. Over the past 52 weeks, STNG's PEG has been as high as 0.22 and as low as 0.09, with a median of 0.17.

Finally, we should also recognize that STNG has a P/CF ratio of 3.26. 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. STNG's P/CF compares to its industry's average P/CF of 3.61. STNG's P/CF has been as high as 6.26 and as low as 2.08, with a median of 2.94, all within the past year.

If you're looking for another solid Transportation - Shipping value stock, take a look at Teekay Tankers (TNK - Free Report) . TNK is a # 2 (Buy) stock with a Value score of A.

Teekay Tankers is trading at a forward earnings multiple of 5.82 at the moment, with a PEG ratio of 1.94. This compares to its industry's average P/E of 6.15 and average PEG ratio of 0.35.

Over the last 12 months, TNK's P/E has been as high as 5.84, as low as 1.98, with a median of 4.05, and its PEG ratio has been as high as 1.95, as low as 0.66, with a median of 1.35.

Additionally, Teekay Tankers has a P/B ratio of 1.28 while its industry's price-to-book ratio sits at 1.11. For TNK, this valuation metric has been as high as 1.51, as low as 0.85, with a median of 1.07 over the past year.

These are just a handful of the figures considered in Scorpio Tankers and Teekay Tankers'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 STNG and TNK is an impressive value stock right now.

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