Back to top

Image: Bigstock

Should Value Investors Buy Dundee Precious Metals (DPMLF) Stock?

Read MoreHide Full Article

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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Dundee Precious Metals (DPMLF - Free Report) is a stock many investors are watching right now. DPMLF is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock holds a P/E ratio of 8.18, while its industry has an average P/E of 12.45. Over the past 52 weeks, DPMLF's Forward P/E has been as high as 9.60 and as low as 5.80, with a median of 8.12.

Finally, our model also underscores that DPMLF has a P/CF ratio of 8.82. 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 10.30. Within the past 12 months, DPMLF's P/CF has been as high as 8.95 and as low as 4.93, with a median of 6.44.

If you're looking for another solid Mining - Gold value stock, take a look at Iamgold (IAG - Free Report) . IAG is a Zacks Rank of #1 (Strong Buy) stock with a Value score of A.

Shares of Iamgold currently hold a Forward P/E ratio of 7.87, and its PEG ratio is 0.31. In comparison, its industry sports average P/E and PEG ratios of 12.45 and 0.42.

IAG's price-to-earnings ratio has been as high as 11.58 and as low as 6.48, with a median of 8.51, while its PEG ratio has been as high as 1.23 and as low as 0.28, with a median of 0.33, all within the past year.

Iamgold also has a P/B ratio of 1.19 compared to its industry's price-to-book ratio of 1.78. Over the past year, its P/B ratio has been as high as 1.34, as low as 0.76, with a median of 1.02.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Dundee Precious Metals and Iamgold are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, DPMLF and IAG feels like a great value stock at the moment.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Published in