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AER vs. WAB: Which Stock Is the Better Value Option?
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Investors with an interest in Transportation - Equipment and Leasing stocks have likely encountered both AerCap (AER - Free Report) and Westinghouse Air Brake Technologies (WAB - 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.
Right now, both AerCap and Westinghouse Air Brake Technologies are sporting a Zacks Rank of #2 (Buy). 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 piece of the puzzle for value investors.
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.
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.
AER currently has a forward P/E ratio of 8.52, while WAB has a forward P/E of 24.40. We also note that AER has a PEG ratio of 1.03. 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. WAB currently has a PEG ratio of 1.85.
Another notable valuation metric for AER is its P/B ratio of 1.34. 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, WAB has a P/B of 3.95.
These metrics, and several others, help AER earn a Value grade of A, while WAB has been given a Value grade of D.
Both AER and WAB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AER is the superior value option right now.
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AER vs. WAB: Which Stock Is the Better Value Option?
Investors with an interest in Transportation - Equipment and Leasing stocks have likely encountered both AerCap (AER - Free Report) and Westinghouse Air Brake Technologies (WAB - 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.
Right now, both AerCap and Westinghouse Air Brake Technologies are sporting a Zacks Rank of #2 (Buy). 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 piece of the puzzle for value investors.
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.
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.
AER currently has a forward P/E ratio of 8.52, while WAB has a forward P/E of 24.40. We also note that AER has a PEG ratio of 1.03. 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. WAB currently has a PEG ratio of 1.85.
Another notable valuation metric for AER is its P/B ratio of 1.34. 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, WAB has a P/B of 3.95.
These metrics, and several others, help AER earn a Value grade of A, while WAB has been given a Value grade of D.
Both AER and WAB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AER is the superior value option right now.