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Time to Buy into the Rally of These Affordable Auto Stocks
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At the moment the risk to reward looks favorable for two affordable auto stocks that could have more near-term upside. Outside of Blue Bird Corp (BLBD - Free Report) ) and Commercial Vehicle Group’s (CVGI - Free Report) ) attractive stock prices, they are starting to check boxes in terms of growth and value.
Let’s take a look at why now may be a good time to invest in both of these top-rated auto stocks at their current levels.
Growth and Diversification
As a manufacturer and producer of school buses and related parts, Blue Bird has an intriguing end market with schools and the education system having significant importance to society. Blue Bird also offers alternative fuel applications and produces propane-powered and compressed natural gas-powered school buses.
Signaling Blue Bird’s growth potential, earnings are forecasted to climb swing from an adjusted loss of -$1.15 a share last year to $0.54 per share in fiscal 2023. More intriguing, fiscal 2024 earnings are projected to skyrocket another 165% at $1.43 per share.
Earnings estimates have trended higher over the last 60 days and Blue Bird’s sales are now expected to climb 42% in FY23 and rise another 10% in FY24 to $1.25 billion.
Image Source: Zacks Investment Research
In regard to end markets, Commercial Vehicle Group is also attractive with its products produced for the global commercial vehicle market. Supplying interior systems, vision safety solutions, and other cab-related products has given Commercial Vehicle Group an extensive reach to the heavy-duty truck market, the construction market, and other specialized transportation markets.
Commercial Vehicle Group’s earnings are expected to soar 86% in FY23 at $0.95 per share compared to EPS of $0.51 in 2022. Plus, FY24 earnings are projected to jump another 15% at $1.10 per share. Earnings estimates are nicely up over the last 60 days. On the top line, sales are forecasted to be up 4% this year and rise another 3% in FY24 to $1.05 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Blue Bird stock has continued to soar this year and is now up a very stellar +102% with Commercial Vehicle Group up +46%. This has easily outperformed the broader indexes and topped the Zacks Auto, Tires, and Trucks sectors +40%.
Image Source: Zacks Investment Research
Despite their impressive rallies, what makes Blue Bird and Commercial Vehicle Group stock still stand out is the price to sales investors are paying relative to their respective industries.
Price to Sales Discount: With Blue Bird stock trading at $21 a share, investors are paying $0.62 for every $1 of sales the company makes. Blue Bird’s P/S ratio of 0.62X is attractively below its industry average of 1.53X with the optimum level being less than 2X and the S&P 500’s average at 3.71X.
Image Source: Zacks Investment Research
Looking at Commercial Vehicle Group, investors are only paying $0.33 for every $1 of sales the company makes. With Commercial Vehicle Group shares trading at $9 its P/S of 0.33X is well below the optimum level, the benchmark's average, and its own industry average of 1.65X.
Image Source: Zacks Investment Research
Takeaway
Blue Bird and Commercial Vehicle Group stock both land a Zacks Rank #2 (Buy) at the moment. In addition to this, these stocks have an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
The opportunity to invest in the growth of companies that have a niche in the broader auto sector is intriguing as there is often an essential or constant need for their business. This scenario makes Blue Bird and Commercial Vehicle Group worthy of consideration and their impressive rallies could continue.
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Time to Buy into the Rally of These Affordable Auto Stocks
At the moment the risk to reward looks favorable for two affordable auto stocks that could have more near-term upside. Outside of Blue Bird Corp (BLBD - Free Report) ) and Commercial Vehicle Group’s (CVGI - Free Report) ) attractive stock prices, they are starting to check boxes in terms of growth and value.
Let’s take a look at why now may be a good time to invest in both of these top-rated auto stocks at their current levels.
Growth and Diversification
As a manufacturer and producer of school buses and related parts, Blue Bird has an intriguing end market with schools and the education system having significant importance to society. Blue Bird also offers alternative fuel applications and produces propane-powered and compressed natural gas-powered school buses.
Signaling Blue Bird’s growth potential, earnings are forecasted to climb swing from an adjusted loss of -$1.15 a share last year to $0.54 per share in fiscal 2023. More intriguing, fiscal 2024 earnings are projected to skyrocket another 165% at $1.43 per share.
Earnings estimates have trended higher over the last 60 days and Blue Bird’s sales are now expected to climb 42% in FY23 and rise another 10% in FY24 to $1.25 billion.
Image Source: Zacks Investment Research
In regard to end markets, Commercial Vehicle Group is also attractive with its products produced for the global commercial vehicle market. Supplying interior systems, vision safety solutions, and other cab-related products has given Commercial Vehicle Group an extensive reach to the heavy-duty truck market, the construction market, and other specialized transportation markets.
Commercial Vehicle Group’s earnings are expected to soar 86% in FY23 at $0.95 per share compared to EPS of $0.51 in 2022. Plus, FY24 earnings are projected to jump another 15% at $1.10 per share. Earnings estimates are nicely up over the last 60 days. On the top line, sales are forecasted to be up 4% this year and rise another 3% in FY24 to $1.05 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Blue Bird stock has continued to soar this year and is now up a very stellar +102% with Commercial Vehicle Group up +46%. This has easily outperformed the broader indexes and topped the Zacks Auto, Tires, and Trucks sectors +40%.
Image Source: Zacks Investment Research
Despite their impressive rallies, what makes Blue Bird and Commercial Vehicle Group stock still stand out is the price to sales investors are paying relative to their respective industries.
Price to Sales Discount: With Blue Bird stock trading at $21 a share, investors are paying $0.62 for every $1 of sales the company makes. Blue Bird’s P/S ratio of 0.62X is attractively below its industry average of 1.53X with the optimum level being less than 2X and the S&P 500’s average at 3.71X.
Image Source: Zacks Investment Research
Looking at Commercial Vehicle Group, investors are only paying $0.33 for every $1 of sales the company makes. With Commercial Vehicle Group shares trading at $9 its P/S of 0.33X is well below the optimum level, the benchmark's average, and its own industry average of 1.65X.
Image Source: Zacks Investment Research
Takeaway
Blue Bird and Commercial Vehicle Group stock both land a Zacks Rank #2 (Buy) at the moment. In addition to this, these stocks have an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
The opportunity to invest in the growth of companies that have a niche in the broader auto sector is intriguing as there is often an essential or constant need for their business. This scenario makes Blue Bird and Commercial Vehicle Group worthy of consideration and their impressive rallies could continue.