Investors should take a closer look at display manufacturer Daktronics, as its shares are undervalued, Zacks analysts write. The stock is trading at a P/E ratio of 18.88 (recall: the lower the ratio, the better), compared with the industry average, according to Zacks, of 23.74.
Details
Zacks evaluates companies based on their financial performance and growth dynamics, and rates Daktronics, a small company with a market capitalization of around $645 million, an A for value. The stock is trading at a P/E of 18.88 versus an average of 23.74 for peers. Thus, Daktronics “feels like a great value stock at the moment,” Zacks analysts conclude.
On Thursday, July 11, Daktronics rose 2.34% to $13.97 per share, making its year-to-date growth almost 65%. According to MarketWatch, one analyst covers the company. It is rated a buy, with a target price of $16.75 per share. Back in June, Simply Wall St analysts also argued that it might be worth taking a closer look at Daktronics, citing continued strong price momentum in the stock.
Context
The last surge in Daktronics stock took place on June 26, when it gained almost 22%. According to Freedom Broker, it benefited from strong tailwinds from its earnings for the fiscal fourth quarter and full-year 2024 (ended April 27, 2024), with record sales and improved profitability.
The company’s revenue for the 2024 fiscal year came in at $818.1 million, up 8.5% compared to the previous year. Gross profit reached 27.2% of net sales, the highest mark since 2009. In the 2025 fiscal year, Daktronics plans to focus on “prioritizing among its end markets, attacking structural cost, and improving its operating model,” stated company CEO Reece Kurtenbach.
About Daktronics
Daktronics calls itself the world’s largest supplier of large-screen video displays, electronic scoreboards, LED text and graphics displays, and related control systems. Among other things, it supplies scoreboards and video displays for high school college sports, professional sports installations, LED and electronic advertising signs, and solutions for the transportation sector, such as intelligent highway systems and airport flight boards.
