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Is Dycom Industries (DY) a Great Value Stock Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 to watch right now is Dycom Industries (DY - Free Report) . DY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

DY is also sporting a PEG ratio of 0.94. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. DY's industry currently sports an average PEG of 1.64. DY's PEG has been as high as 3.15 and as low as 0.84, with a median of 2.17, all within the past year.

Another valuation metric that we should highlight is DY's P/B ratio of 1.33. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.80. DY's P/B has been as high as 2.30 and as low as 0.49, with a median of 1.69, over the past year.

Finally, our model also underscores that DY has a P/CF ratio of 4.30. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. DY's P/CF compares to its industry's average P/CF of 8. DY's P/CF has been as high as 7.18 and as low as 1.58, with a median of 5.58, all within the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Dycom Industries is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, DY feels like a great value stock at the moment.


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