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ALSN or RACE: Which Is the Better Value Stock Right Now?
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Investors with an interest in Automotive - Original Equipment stocks have likely encountered both Allison Transmission (ALSN - Free Report) and Ferrari (RACE - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, Allison Transmission has a Zacks Rank of #1 (Strong Buy), while Ferrari has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ALSN has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
ALSN currently has a forward P/E ratio of 8.19, while RACE has a forward P/E of 47. We also note that ALSN has a PEG ratio of 1.17. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. RACE currently has a PEG ratio of 3.11.
Another notable valuation metric for ALSN is its P/B ratio of 4.99. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, RACE has a P/B of 20.63.
These are just a few of the metrics contributing to ALSN's Value grade of A and RACE's Value grade of C.
ALSN stands above RACE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ALSN is the superior value option right now.
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ALSN or RACE: Which Is the Better Value Stock Right Now?
Investors with an interest in Automotive - Original Equipment stocks have likely encountered both Allison Transmission (ALSN - Free Report) and Ferrari (RACE - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, Allison Transmission has a Zacks Rank of #1 (Strong Buy), while Ferrari has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ALSN has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
ALSN currently has a forward P/E ratio of 8.19, while RACE has a forward P/E of 47. We also note that ALSN has a PEG ratio of 1.17. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. RACE currently has a PEG ratio of 3.11.
Another notable valuation metric for ALSN is its P/B ratio of 4.99. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, RACE has a P/B of 20.63.
These are just a few of the metrics contributing to ALSN's Value grade of A and RACE's Value grade of C.
ALSN stands above RACE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ALSN is the superior value option right now.