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MTRX vs. ACM: Which Stock Is the Better Value Option?

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Investors interested in Engineering - R and D Services stocks are likely familiar with Matrix Service (MTRX - Free Report) and Aecom Technology (ACM - 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 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.

Currently, Matrix Service has a Zacks Rank of #2 (Buy), while Aecom Technology has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that MTRX likely has seen a stronger improvement to its earnings outlook than ACM has recently. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

MTRX currently has a forward P/E ratio of 19.47, while ACM has a forward P/E of 23.55. We also note that MTRX has a PEG ratio of 1.08. 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. ACM currently has a PEG ratio of 1.96.

Another notable valuation metric for MTRX is its P/B ratio of 2.54. 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, ACM has a P/B of 6.55.

Based on these metrics and many more, MTRX holds a Value grade of A, while ACM has a Value grade of C.

MTRX has seen stronger estimate revision activity and sports more attractive valuation metrics than ACM, so it seems like value investors will conclude that MTRX is the superior option right now.


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