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SSW vs. KEX: Which Stock Is the Better Value Option?

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Investors interested in Transportation - Shipping stocks are likely familiar with Seaspan and Kirby (KEX - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 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, Seaspan is sporting a Zacks Rank of #2 (Buy), while Kirby has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that SSW is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.

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.

SSW currently has a forward P/E ratio of 7.44, while KEX has a forward P/E of 22.64. We also note that SSW has a PEG ratio of 0.47. 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. KEX currently has a PEG ratio of 1.70.

Another notable valuation metric for SSW is its P/B ratio of 0.39. 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, KEX has a P/B of 1.18.

These metrics, and several others, help SSW earn a Value grade of A, while KEX has been given a Value grade of C.

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


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