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URI vs. HLMN: Which Stock Is the Better Value Option?

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Investors with an interest in Building Products - Miscellaneous stocks have likely encountered both United Rentals (URI - Free Report) and Hillman Solutions Corp. (HLMN - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, United Rentals is sporting a Zacks Rank of #2 (Buy), while Hillman Solutions Corp. has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that URI has an improving earnings outlook. But this is only part of the picture 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

URI currently has a forward P/E ratio of 15.29, while HLMN has a forward P/E of 52.83. We also note that URI has a PEG ratio of 1.14. 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. HLMN currently has a PEG ratio of 3.52.

Another notable valuation metric for URI is its P/B ratio of 4.93. 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, HLMN has a P/B of 156.43.

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

URI stands above HLMN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that URI is the superior value option right now.


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