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WRK vs. GLT: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Paper and Related Products sector might want to consider either WestRock (WRK - Free Report) or Glatfelter (GLT - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

WestRock has a Zacks Rank of #2 (Buy), while Glatfelter has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that WRK likely has seen a stronger improvement to its earnings outlook than GLT has recently. But this is just one factor that value investors are interested in.

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.

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.

WRK currently has a forward P/E ratio of 9.09, while GLT has a forward P/E of 20.93. We also note that WRK has a PEG ratio of 2.01. 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. GLT currently has a PEG ratio of 4.19.

Another notable valuation metric for WRK is its P/B ratio of 0.78. 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, GLT has a P/B of 1.23.

These metrics, and several others, help WRK earn a Value grade of A, while GLT has been given a Value grade of D.

WRK stands above GLT thanks to its solid earnings outlook, and based on these valuation figures, we also feel that WRK is the superior value option right now.


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