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Westinghouse Air Brake Technologies Corporation (WAB) - free report >>
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TRTN or WAB: Which Is the Better Value Stock Right Now?
Investors interested in Transportation - Equipment and Leasing stocks are likely familiar with Triton International and Westinghouse Air Brake Technologies (WAB - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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.
Triton International and Westinghouse Air Brake Technologies are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that TRTN's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst 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.
TRTN currently has a forward P/E ratio of 5.30, while WAB has a forward P/E of 17.65. We also note that TRTN has a PEG ratio of 0.53. 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. WAB currently has a PEG ratio of 1.33.
Another notable valuation metric for TRTN is its P/B ratio of 1.45. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, WAB has a P/B of 1.59.
These metrics, and several others, help TRTN earn a Value grade of A, while WAB has been given a Value grade of C.
TRTN is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TRTN is likely the superior value option right now.