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AMWD vs. WSC: Which Stock Should Value Investors Buy Now?

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Investors with an interest in Furniture stocks have likely encountered both American Woodmark (AMWD - Free Report) and WillScot (WSC - 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, American Woodmark is sporting a Zacks Rank of #1 (Strong Buy), while WillScot has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that AMWD likely has seen a stronger improvement to its earnings outlook than WSC has recently. But this is just one piece of the puzzle 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 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.

AMWD currently has a forward P/E ratio of 11.73, while WSC has a forward P/E of 22.11. We also note that AMWD has a PEG ratio of 0.90. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. WSC currently has a PEG ratio of 1.01.

Another notable valuation metric for AMWD is its P/B ratio of 1.81. 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, WSC has a P/B of 7.03.

These are just a few of the metrics contributing to AMWD's Value grade of A and WSC's Value grade of C.

AMWD 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 AMWD is likely the superior value option right now.


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