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Are Investors Undervaluing Golar LNG Partners LP (GMLP) Right Now?

Zacks

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 value investors might notice is Golar LNG Partners LP (GMLP). GMLP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 12.07. This compares to its industry’s average Forward P/E of 17.55. GMLP’s Forward P/E has been as high as 18.37 and as low as 9.31, with a median of 12.86, all within the past year.


GMLP is also sporting a PEG ratio of 1.51. 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. GMLP’s industry has an average PEG of 2.79 right now. Over the past 52 weeks, GMLP’s PEG has been as high as 2.16 and as low as 1.16, with a median of 1.60.

Another notable valuation metric for GMLP is its P/B ratio of 1.42. 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 1.44. Over the past year, GMLP’s P/B has been as high as 2.30 and as low as 1.09, with a median of 1.61.

Finally, investors will want to recognize that GMLP has a P/CF ratio of 4.12. 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. This company’s current P/CF looks solid when compared to its industry’s average P/CF of 6.28. Over the past 52 weeks, GMLP’s P/CF has been as high as 6.74 and as low as 3.17, with a median of 5.05.

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


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