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Are Investors Undervaluing Donegal Group (DGICA) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 Donegal Group (DGICA - Free Report) . DGICA is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 9.36, which compares to its industry's average of 27.83. DGICA's Forward P/E has been as high as 18.88 and as low as 9.13, with a median of 14.42, all within the past year.
Another valuation metric that we should highlight is DGICA's P/B ratio of 1.16. 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. This company's current P/B looks solid when compared to its industry's average P/B of 1.51. Over the past 12 months, DGICA's P/B has been as high as 1.28 and as low as 0.93, with a median of 1.08.
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. DGICA has a P/S ratio of 0.72. This compares to its industry's average P/S of 1.27.
Finally, investors will want to recognize that DGICA has a P/CF ratio of 6.98. 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. DGICA's current P/CF looks attractive when compared to its industry's average P/CF of 12.49. Over the past 52 weeks, DGICA's P/CF has been as high as 37.36 and as low as 6.05, with a median of 8.11.
Investors could also keep in mind The Travelers Companies (TRV - Free Report) , another Insurance - Property and Casualty stock with a Zacks Rank of #1 (Strong Buy) and Value grade of A.
Shares of The Travelers Companies are currently trading at a forward earnings multiple of 11.60 and a PEG ratio of 2.87 compared to its industry's P/E and PEG ratios of 27.83 and 3.67, respectively.
TRV's Forward P/E has been as high as 14.64 and as low as 11.13, with a median of 12.44. During the same time period, its PEG ratio has been as high as 4.80, as low as 1.01, with a median of 2.83.
Furthermore, The Travelers Companies holds a P/B ratio of 2.11 and its industry's price-to-book ratio is 1.51. TRV's P/B has been as high as 2.22, as low as 1.85, with a median of 2.07 over the past 12 months.
These are just a handful of the figures considered in Donegal Group and The Travelers Companies'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 DGICA and TRV is an impressive value stock right now.
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Are Investors Undervaluing Donegal Group (DGICA) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 Donegal Group (DGICA - Free Report) . DGICA is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 9.36, which compares to its industry's average of 27.83. DGICA's Forward P/E has been as high as 18.88 and as low as 9.13, with a median of 14.42, all within the past year.
Another valuation metric that we should highlight is DGICA's P/B ratio of 1.16. 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. This company's current P/B looks solid when compared to its industry's average P/B of 1.51. Over the past 12 months, DGICA's P/B has been as high as 1.28 and as low as 0.93, with a median of 1.08.
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. DGICA has a P/S ratio of 0.72. This compares to its industry's average P/S of 1.27.
Finally, investors will want to recognize that DGICA has a P/CF ratio of 6.98. 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. DGICA's current P/CF looks attractive when compared to its industry's average P/CF of 12.49. Over the past 52 weeks, DGICA's P/CF has been as high as 37.36 and as low as 6.05, with a median of 8.11.
Investors could also keep in mind The Travelers Companies (TRV - Free Report) , another Insurance - Property and Casualty stock with a Zacks Rank of #1 (Strong Buy) and Value grade of A.
Shares of The Travelers Companies are currently trading at a forward earnings multiple of 11.60 and a PEG ratio of 2.87 compared to its industry's P/E and PEG ratios of 27.83 and 3.67, respectively.
TRV's Forward P/E has been as high as 14.64 and as low as 11.13, with a median of 12.44. During the same time period, its PEG ratio has been as high as 4.80, as low as 1.01, with a median of 2.83.
Furthermore, The Travelers Companies holds a P/B ratio of 2.11 and its industry's price-to-book ratio is 1.51. TRV's P/B has been as high as 2.22, as low as 1.85, with a median of 2.07 over the past 12 months.
These are just a handful of the figures considered in Donegal Group and The Travelers Companies'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 DGICA and TRV is an impressive value stock right now.