GBX vs. WAB: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Transportation - Equipment and Leasing sector have probably already heard of Greenbrier Companies (GBX) and Westinghouse Air Brake Technologies (WAB). 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.
Greenbrier Companies and Westinghouse Air Brake Technologies are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that GBX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
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.
GBX currently has a forward P/E ratio of 13.73, while WAB has a forward P/E of 27.91. We also note that GBX has a PEG ratio of 1.45. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. WAB currently has a PEG ratio of 1.86.
Another notable valuation metric for GBX is its P/B ratio of 1.38. 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, WAB has a P/B of 3.63.
These metrics, and several others, help GBX earn a Value grade of A, while WAB has been given a Value grade of D.
GBX stands above WAB thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GBX is the superior value option right now.
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Greenbrier Companies, Inc. (The) (GBX) : Free Stock Analysis Report
Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report
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