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ECHO vs. ASR: Which Stock Is the Better Value Option?

Zacks Equity Research
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Investors interested in Transportation - Services stocks are likely familiar with Echo Global Logistics (ECHO) and Grupo Aeroportuario del Sureste (ASR). 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Echo Global Logistics and Grupo Aeroportuario del Sureste are sporting Zacks Ranks of #1 (Strong Buy) and #5 (Strong Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ECHO is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

ECHO currently has a forward P/E ratio of 20.03, while ASR has a forward P/E of 20.50. We also note that ECHO has a PEG ratio of 1.14. 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. ASR currently has a PEG ratio of 4.66.

Another notable valuation metric for ECHO is its P/B ratio of 2.29. 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, ASR has a P/B of 2.52.

Based on these metrics and many more, ECHO holds a Value grade of B, while ASR has a Value grade of D.

ECHO sticks out from ASR in both our Zacks Rank and Style Scores models, so value investors will likely feel that ECHO is the better option right now.


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Echo Global Logistics, Inc. (ECHO) : Free Stock Analysis Report
 
Grupo Aeroportuario del Sureste, S.A. de C.V. (ASR) : Free Stock Analysis Report
 
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