Back to top

Image: Bigstock

OSK or WBC: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Automotive - Original Equipment sector might want to consider either Oshkosh (OSK - Free Report) or Wabco Holdings . 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Oshkosh and Wabco Holdings are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that OSK has an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.

OSK currently has a forward P/E ratio of 10.05, while WBC has a forward P/E of 16.90. We also note that OSK has a PEG ratio of 0.89. 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. WBC currently has a PEG ratio of 1.13.

Another notable valuation metric for OSK is its P/B ratio of 2.18. 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, WBC has a P/B of 5.44.

These metrics, and several others, help OSK earn a Value grade of B, while WBC has been given a Value grade of C.

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


See More Zacks Research for These Tickers


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


Oshkosh Corporation (OSK) - free report >>

Published in