Is Covenant Logistics Group (CVLG) a Great Value Stock Right Now?
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company value investors might notice is Covenant Logistics Group (CVLG). CVLG is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with P/E ratio of 6.93 right now. For comparison, its industry sports an average P/E of 15.18. Over the past 52 weeks, CVLG's Forward P/E has been as high as 9.80 and as low as 4.97, with a median of 6.54.
Another valuation metric that we should highlight is CVLG's P/B ratio of 1.19. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. CVLG's current P/B looks attractive when compared to its industry's average P/B of 3.31. CVLG's P/B has been as high as 1.75 and as low as 0.81, with a median of 1.15, over the past year.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CVLG has a P/S ratio of 0.35. This compares to its industry's average P/S of 0.97.
Finally, our model also underscores that CVLG has a P/CF ratio of 3.35. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 10.25. CVLG's P/CF has been as high as 8.04 and as low as 2.42, with a median of 3.41, all within the past year.
P.A.M. Transportation Services (PTSI) may be another strong Transportation - Truck stock to add to your shortlist. PTSI is a # 2 (Buy) stock with a Value grade of A.
Furthermore, P.A.M. Transportation Services holds a P/B ratio of 2.58 and its industry's price-to-book ratio is 3.31. PTSI's P/B has been as high as 4.70, as low as 2.32, with a median of 2.99 over the past 12 months.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Covenant Logistics Group and P.A.M. Transportation Services are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CVLG and PTSI feels like a great value stock at the moment.
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Covenant Logistics Group, Inc. (CVLG) : Free Stock Analysis Report
P.A.M. Transportation Services, Inc. (PTSI) : Free Stock Analysis Report
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