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TEX vs. CAT: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Manufacturing - Construction and Mining sector might want to consider either Terex (TEX - Free Report) or Caterpillar (CAT - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Terex and Caterpillar have a Zacks Rank of # 1 (Strong Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.
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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
TEX currently has a forward P/E ratio of 8.31, while CAT has a forward P/E of 12.37. We also note that TEX has a PEG ratio of 0.47. 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. CAT currently has a PEG ratio of 1.03.
Another notable valuation metric for TEX is its P/B ratio of 2.49. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, CAT has a P/B of 6.09.
Based on these metrics and many more, TEX holds a Value grade of B, while CAT has a Value grade of C.
Both TEX and CAT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TEX is the superior value option right now.
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TEX vs. CAT: Which Stock Is the Better Value Option?
Investors looking for stocks in the Manufacturing - Construction and Mining sector might want to consider either Terex (TEX - Free Report) or Caterpillar (CAT - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Terex and Caterpillar have a Zacks Rank of # 1 (Strong Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.
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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
TEX currently has a forward P/E ratio of 8.31, while CAT has a forward P/E of 12.37. We also note that TEX has a PEG ratio of 0.47. 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. CAT currently has a PEG ratio of 1.03.
Another notable valuation metric for TEX is its P/B ratio of 2.49. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, CAT has a P/B of 6.09.
Based on these metrics and many more, TEX holds a Value grade of B, while CAT has a Value grade of C.
Both TEX and CAT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TEX is the superior value option right now.