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Old Dominion Freight Line, Inc. (ODFL) - free report >>
Knight-Swift Transportation Holdings Inc. (KNX) - free report >>
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Old Dominion Freight Line, Inc. (ODFL) - free report >>
Knight-Swift Transportation Holdings Inc. (KNX) - free report >>
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KNX vs. ODFL: Which Stock Is the Better Value Option?
Investors interested in Transportation - Truck stocks are likely familiar with Knight-Swift Transportation Holdings (KNX - Free Report) and Old Dominion Freight Line (ODFL - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, both Knight-Swift Transportation Holdings and Old Dominion Freight Line are holding a Zacks Rank of # 1 (Strong Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
KNX currently has a forward P/E ratio of 14.81, while ODFL has a forward P/E of 35.73. We also note that KNX has a PEG ratio of 0.99. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ODFL currently has a PEG ratio of 3.39.
Another notable valuation metric for KNX is its P/B ratio of 1.13. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ODFL has a P/B of 7.02.
These metrics, and several others, help KNX earn a Value grade of A, while ODFL has been given a Value grade of F.
Both KNX and ODFL are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that KNX is the superior value option right now.