STRT vs. MBLY: Which Stock Is the Better Value Option?

STRT MBLY

Investors interested in stocks from the Automotive - Original Equipment sector have probably already heard of Strattec Security (STRT - Free Report) and Mobileye Global (MBLY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.

Strattec Security and Mobileye Global are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that STRT likely has seen a stronger improvement to its earnings outlook than MBLY has recently. But this is just one piece of the puzzle for value investors.

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.

STRT currently has a forward P/E ratio of 26.40, while MBLY has a forward P/E of 51.34. We also note that STRT has a PEG ratio of 2.64. 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. MBLY currently has a PEG ratio of 2.69.

Another notable valuation metric for STRT is its P/B ratio of 0.43. 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, MBLY has a P/B of 1.98.

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

STRT has seen stronger estimate revision activity and sports more attractive valuation metrics than MBLY, so it seems like value investors will conclude that STRT is the superior option right now.

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