Should Value Investors Buy Delta Apparel (DLA) Stock?
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...
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is Delta Apparel (DLA). DLA is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 8.85, which compares to its industry's average of 20.19. Over the last 12 months, DLA's Forward P/E has been as high as 17.09 and as low as 8.22, with a median of 13.57.
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. DLA has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.95.
Value investors will likely look at more than just these metrics, but the above data helps show that Delta Apparel, Inc. Is likely undervalued currently. And when considering the strength of its earnings outlook, DLA sticks out at as one of the market's strongest value stocks.
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Delta Apparel, Inc. (DLA): Free Stock Analysis Report
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