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STRL or HWM: Which Is the Better Value Stock Right Now?

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Investors with an interest in Engineering - R and D Services stocks have likely encountered both Sterling Infrastructure (STRL - Free Report) and Howmet (HWM - 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.

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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Sterling Infrastructure has a Zacks Rank of #2 (Buy), while Howmet has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that STRL likely has seen a stronger improvement to its earnings outlook than HWM has recently. But this is only part of the picture for value investors.

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.

STRL currently has a forward P/E ratio of 10.21, while HWM has a forward P/E of 26.56. We also note that STRL has a PEG ratio of 0.57. 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. HWM currently has a PEG ratio of 1.11.

Another notable valuation metric for STRL is its P/B ratio of 2.23. 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, HWM has a P/B of 4.77.

These metrics, and several others, help STRL earn a Value grade of A, while HWM has been given a Value grade of D.

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


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Sterling Infrastructure, Inc. (STRL) - free report >>

Howmet Aerospace Inc. (HWM) - free report >>

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