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GBX vs. WAB: Which Stock Should Value Investors Buy Now?

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Investors interested in Transportation - Equipment and Leasing stocks are likely familiar with Greenbrier Companies (GBX - Free Report) and Westinghouse Air Brake Technologies (WAB - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Greenbrier Companies has a Zacks Rank of #2 (Buy), while Westinghouse Air Brake Technologies has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that GBX likely has seen a stronger improvement to its earnings outlook than WAB has recently. 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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

GBX currently has a forward P/E ratio of 13.53, while WAB has a forward P/E of 28.45. We also note that GBX has a PEG ratio of 1.42. 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 2.47.

Another notable valuation metric for GBX is its P/B ratio of 1.36. 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, WAB has a P/B of 3.71.

Based on these metrics and many more, GBX holds a Value grade of A, while WAB has a Value grade of D.

GBX 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 GBX is likely the superior value option right now.


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Greenbrier Companies, Inc. (The) (GBX) - free report >>

Westinghouse Air Brake Technologies Corporation (WAB) - free report >>