Don't overlook NYSE:LPG—it's a hidden gem with strong fundamentals and an attractive price tag.

Last update: Jan 17, 2025

Our stock screening tool has pinpointed DORIAN LPG LTD (NYSE:LPG) as an undervalued stock option. NYSE:LPG retains a strong financial foundation and an attractive price tag. Let's delve into the specifics below.

Deciphering NYSE:LPG's Valuation Rating

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NYSE:LPG has earned a 8 for valuation:

With a Price/Earnings ratio of 4.14, the valuation of LPG can be described as very cheap.
93.14% of the companies in the same industry are more expensive than LPG, based on the Price/Earnings ratio.
LPG is valuated cheaply when we compare the Price/Earnings ratio to 27.80, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 7.14, the valuation of LPG can be described as very cheap.
LPG's Price/Forward Earnings ratio is rather cheap when compared to the industry. LPG is cheaper than 80.39% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of LPG to the average of the S&P500 Index (23.98), we can say LPG is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LPG indicates a somewhat cheap valuation: LPG is cheaper than 76.47% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, LPG is valued cheaply inside the industry as 91.67% of the companies are valued more expensively.
LPG has an outstanding profitability rating, which may justify a higher PE ratio.

Analyzing Profitability Metrics

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:LPG was assigned a score of 8 for profitability:

LPG has a Return On Assets of 12.89%. This is amongst the best in the industry. LPG outperforms 85.29% of its industry peers.
The Return On Equity of LPG (22.05%) is better than 76.96% of its industry peers.
LPG has a Return On Invested Capital of 12.02%. This is in the better half of the industry: LPG outperforms 75.98% of its industry peers.
The last Return On Invested Capital (12.02%) for LPG is above the 3 year average (9.72%), which is a sign of increasing profitability.
LPG's Profit Margin of 47.87% is amongst the best of the industry. LPG outperforms 90.69% of its industry peers.
In the last couple of years the Profit Margin of LPG has grown nicely.
With an excellent Operating Margin value of 53.33%, LPG belongs to the best of the industry, outperforming 90.69% of the companies in the same industry.
LPG's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 91.17%, LPG belongs to the top of the industry, outperforming 95.59% of the companies in the same industry.

A Closer Look at Health for NYSE:LPG

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NYSE:LPG scores a 7 out of 10:

The Debt to FCF ratio of LPG is 1.96, which is an excellent value as it means it would take LPG, only 1.96 years of fcf income to pay off all of its debts.
LPG has a better Debt to FCF ratio (1.96) than 76.96% of its industry peers.
A Debt/Equity ratio of 0.48 indicates that LPG is not too dependend on debt financing.
A Current Ratio of 4.22 indicates that LPG has no problem at all paying its short term obligations.
The Current ratio of LPG (4.22) is better than 86.76% of its industry peers.
LPG has a Quick Ratio of 4.20. This indicates that LPG is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of LPG (4.20) is better than 87.25% of its industry peers.

Evaluating Growth: NYSE:LPG

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:LPG has achieved a 4 out of 10:

Measured over the past years, LPG shows a very strong growth in Earnings Per Share. The EPS has been growing by 63.39% on average per year.
Measured over the past years, LPG shows a very strong growth in Revenue. The Revenue has been growing by 28.83% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of LPG

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.