Back to top

Image: Bigstock

WERN vs. JBHT: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors looking for stocks in the Transportation - Truck sector might want to consider either Werner Enterprises (WERN - Free Report) or JB Hunt (JBHT - 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Werner Enterprises and JB Hunt are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that WERN is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

WERN currently has a forward P/E ratio of 14.16, while JBHT has a forward P/E of 20.32. We also note that WERN has a PEG ratio of 0.98. 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. JBHT currently has a PEG ratio of 1.69.

Another notable valuation metric for WERN is its P/B ratio of 1.88. 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, JBHT has a P/B of 5.77.

Based on these metrics and many more, WERN holds a Value grade of A, while JBHT has a Value grade of C.

WERN is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that WERN is likely the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


J.B. Hunt Transport Services, Inc. (JBHT) - free report >>

Werner Enterprises, Inc. (WERN) - free report >>

Published in