BECN vs. FAST: Which Stock Should Value Investors Buy Now?
Investors with an interest in Building Products - Retail stocks have likely encountered both Beacon Roofing Supply (BECN) and Fastenal (FAST). 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Beacon Roofing Supply and Fastenal are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that BECN likely has seen a stronger improvement to its earnings outlook than FAST has recently. But this is just one piece of the puzzle for value investors.
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.
BECN currently has a forward P/E ratio of 12.28, while FAST has a forward P/E of 28.78. We also note that BECN has a PEG ratio of 1.87. 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. FAST currently has a PEG ratio of 3.20.
Another notable valuation metric for BECN is its P/B ratio of 2.63. 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, FAST has a P/B of 9.65.
Based on these metrics and many more, BECN holds a Value grade of A, while FAST has a Value grade of C.
BECN stands above FAST thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BECN is the superior value option right now.
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Beacon Roofing Supply, Inc. (BECN) : Free Stock Analysis Report
Fastenal Company (FAST) : Free Stock Analysis Report
