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LMT or HWM: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Aerospace - Defense sector might want to consider either Lockheed Martin (LMT - Free Report) or Howmet (HWM - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Right now, both Lockheed Martin and Howmet 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 are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
LMT currently has a forward P/E ratio of 16.64, while HWM has a forward P/E of 43.06. We also note that LMT has a PEG ratio of 1.10. 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. HWM currently has a PEG ratio of 2.07.
Another notable valuation metric for LMT is its P/B ratio of 13.34. 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, HWM has a P/B of 16.02.
Based on these metrics and many more, LMT holds a Value grade of B, while HWM has a Value grade of D.
Both LMT and HWM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that LMT is the superior value option right now.
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LMT or HWM: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Aerospace - Defense sector might want to consider either Lockheed Martin (LMT - Free Report) or Howmet (HWM - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Right now, both Lockheed Martin and Howmet 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 are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
LMT currently has a forward P/E ratio of 16.64, while HWM has a forward P/E of 43.06. We also note that LMT has a PEG ratio of 1.10. 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. HWM currently has a PEG ratio of 2.07.
Another notable valuation metric for LMT is its P/B ratio of 13.34. 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, HWM has a P/B of 16.02.
Based on these metrics and many more, LMT holds a Value grade of B, while HWM has a Value grade of D.
Both LMT and HWM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that LMT is the superior value option right now.