Investors interested in Furniture stocks are likely familiar with American Woodmark (AMWD) and WillScot (WSC). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
American Woodmark has a Zacks Rank of #2 (Buy), while WillScot has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that AMWD is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
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 11.81, while WSC has a forward P/E of 845. We also note that AMWD has a PEG ratio of 1.31. 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. WSC currently has a PEG ratio of 56.33.
Another notable valuation metric for AMWD is its P/B ratio of 2.58. 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, WSC has a P/B of 3.
These metrics, and several others, help AMWD earn a Value grade of B, while WSC has been given a Value grade of D.
AMWD 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 AMWD is likely the superior value option right now.
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American Woodmark Corporation (AMWD) : Free Stock Analysis Report
WillScot Corporation (WSC) : Free Stock Analysis Report
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