Back to top

Image: Bigstock

AMWD vs. WSC: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors interested in Furniture stocks are likely familiar with American Woodmark (AMWD - Free Report) and WillScot (WSC - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, American Woodmark has a Zacks Rank of #2 (Buy), while WillScot has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that AMWD has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

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.

AMWD currently has a forward P/E ratio of 14.29, while WSC has a forward P/E of 63.78. We also note that AMWD has a PEG ratio of 1.59. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. WSC currently has a PEG ratio of 4.25.

Another notable valuation metric for AMWD is its P/B ratio of 2.69. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, WSC has a P/B of 2.94.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


WillScot Mobile Mini Holdings Corp. (WSC) - free report >>

American Woodmark Corporation (AMWD) - free report >>

Published in