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CMRE vs. DHT: Which Stock Is the Better Value Option?

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Investors with an interest in Transportation - Shipping stocks have likely encountered both Costamare (CMRE - Free Report) and DHT Holdings (DHT - 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.

Right now, Costamare is sporting a Zacks Rank of #1 (Strong Buy), while DHT Holdings has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CMRE has an improving earnings outlook. However, value investors will care about much more than just this.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

CMRE currently has a forward P/E ratio of 8.95, while DHT has a forward P/E of 25.40. We also note that CMRE has a PEG ratio of 1.79. 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. DHT currently has a PEG ratio of 5.08.

Another notable valuation metric for CMRE is its P/B ratio of 0.45. 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, DHT has a P/B of 0.86.

These metrics, and several others, help CMRE earn a Value grade of A, while DHT has been given a Value grade of D.

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


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