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ARCB vs. SAIA: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Transportation - Truck sector have probably already heard of ArcBest (ARCB - Free Report) and Saia (SAIA - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

ArcBest has a Zacks Rank of #1 (Strong Buy), while Saia has a Zacks Rank of #2 (Buy) right now. This means that ARCB's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

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.

ARCB currently has a forward P/E ratio of 10.46, while SAIA has a forward P/E of 30.01. We also note that ARCB has a PEG ratio of 0.45. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. SAIA currently has a PEG ratio of 1.

Another notable valuation metric for ARCB is its P/B ratio of 1.88. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SAIA has a P/B of 5.92.

Based on these metrics and many more, ARCB holds a Value grade of A, while SAIA has a Value grade of D.

ARCB has seen stronger estimate revision activity and sports more attractive valuation metrics than SAIA, so it seems like value investors will conclude that ARCB is the superior option right now.


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