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VC vs. ATMU: Which Stock Is the Better Value Option?

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Investors interested in Automotive - Original Equipment stocks are likely familiar with Visteon (VC - Free Report) and Atmus Filtration Technologies (ATMU - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Visteon and Atmus Filtration Technologies are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that VC has an improving earnings outlook. However, value investors will care about much more than just this.

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.

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.

VC currently has a forward P/E ratio of 12.01, while ATMU has a forward P/E of 18.24. We also note that VC has a PEG ratio of 1.29. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ATMU currently has a PEG ratio of 2.31.

Another notable valuation metric for VC is its P/B ratio of 1.68. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, ATMU has a P/B of 10.9.

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

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

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