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CSL or RAVN: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Diversified Operations sector might want to consider either Carlisle (CSL - Free Report) or Raven Industries . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Carlisle is sporting a Zacks Rank of #2 (Buy), while Raven Industries 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 CSL has an improving earnings outlook. But this is only part of the picture for value investors.

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.

CSL currently has a forward P/E ratio of 20.13, while RAVN has a forward P/E of 24.18. We also note that CSL has a PEG ratio of 1.34. 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. RAVN currently has a PEG ratio of 2.42.

Another notable valuation metric for CSL is its P/B ratio of 2.74. 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, RAVN has a P/B of 4.71.

These metrics, and several others, help CSL earn a Value grade of B, while RAVN has been given a Value grade of D.

CSL sticks out from RAVN in both our Zacks Rank and Style Scores models, so value investors will likely feel that CSL is the better option right now.


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