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Should Value Investors Buy Dynagas LNG (DLNG) Stock?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 stock to keep an eye on is Dynagas LNG (DLNG - Free Report) . DLNG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 10.05. This compares to its industry's average Forward P/E of 17.15. Over the last 12 months, DLNG's Forward P/E has been as high as 24.81 and as low as 7.29, with a median of 14.05.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. DLNG has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.67.

These are only a few of the key metrics included in Dynagas LNG'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, DLNG looks like an impressive value stock at the moment.


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