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NVGS vs. GNK: Which Stock Is the Better Value Option?

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Investors with an interest in Transportation - Shipping stocks have likely encountered both Navigator Holdings (NVGS - Free Report) and Genco Shipping & Trading (GNK - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Navigator Holdings and Genco Shipping & Trading are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that NVGS likely has seen a stronger improvement to its earnings outlook than GNK has recently. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

NVGS currently has a forward P/E ratio of 13.09, while GNK has a forward P/E of 21.06. We also note that NVGS has a PEG ratio of 1.10. 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. GNK currently has a PEG ratio of 5.48.

Another notable valuation metric for NVGS is its P/B ratio of 1.06. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, GNK has a P/B of 1.15.

These are just a few of the metrics contributing to NVGS's Value grade of B and GNK's Value grade of D.

NVGS has seen stronger estimate revision activity and sports more attractive valuation metrics than GNK, so it seems like value investors will conclude that NVGS is the superior option right now.

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