BLWYY vs. ROAD: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Building Products - Miscellaneous sector might want to consider either BELLWAY (BLWYY) or Construction Partners (ROAD). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
BELLWAY and Construction Partners are sporting Zacks Ranks of #2 (Buy) and #5 (Strong Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that BLWYY has an improving earnings outlook. 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.
BLWYY currently has a forward P/E ratio of 7.27, while ROAD has a forward P/E of 19.08. We also note that BLWYY has a PEG ratio of 7.27. 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. ROAD currently has a PEG ratio of 7.98.
Another notable valuation metric for BLWYY is its P/B ratio of 1.25. 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, ROAD has a P/B of 2.57.
Based on these metrics and many more, BLWYY holds a Value grade of A, while ROAD has a Value grade of C.
BLWYY stands above ROAD thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BLWYY is the superior value option right now.
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