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AMWD or WSC: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Furniture sector might want to consider either American Woodmark (AMWD - Free Report) or WillScot (WSC - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

American Woodmark has a Zacks Rank of #1 (Strong Buy), while WillScot has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that AMWD is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.

AMWD currently has a forward P/E ratio of 12.05, while WSC has a forward P/E of 223.57. We also note that AMWD has a PEG ratio of 1.34. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. WSC currently has a PEG ratio of 14.90.

Another notable valuation metric for AMWD is its P/B ratio of 2.73. 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, WSC has a P/B of 2.77.

These are just a few of the metrics contributing to AMWD's Value grade of A and WSC's Value grade of C.

AMWD stands above WSC thanks to its solid earnings outlook, and based on these valuation figures, we also feel that AMWD is the superior value option right now.


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