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MOD vs. OSK: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Automotive - Original Equipment sector might want to consider either Modine (MOD - Free Report) or Oshkosh (OSK - 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Modine and Oshkosh are sporting Zacks Ranks of #1 (Strong Buy) and #4 (Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that MOD has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

MOD currently has a forward P/E ratio of 2.51, while OSK has a forward P/E of 10.58. We also note that MOD has a PEG ratio of 0.25. 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. OSK currently has a PEG ratio of 1.20.

Another notable valuation metric for MOD is its P/B ratio of 0.28. 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, OSK has a P/B of 1.58.

These are just a few of the metrics contributing to MOD's Value grade of A and OSK's Value grade of D.

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


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Oshkosh Corporation (OSK) - free report >>

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