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GLW vs. AIRG: Which Stock Should Value Investors Buy Now?

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·2 min read
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Investors with an interest in Communication - Components stocks have likely encountered both Corning (GLW) and Airgain (AIRG). 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.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, Corning has a Zacks Rank of #2 (Buy), while Airgain has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that GLW likely has seen a stronger improvement to its earnings outlook than AIRG has recently. However, value investors will care about much more than just this.

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.

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.

GLW currently has a forward P/E ratio of 20.36, while AIRG has a forward P/E of 68.03. We also note that GLW has a PEG ratio of 1.46. 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. AIRG currently has a PEG ratio of 1.94.

Another notable valuation metric for GLW is its P/B ratio of 2.67. 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, AIRG has a P/B of 4.32.

These are just a few of the metrics contributing to GLW's Value grade of B and AIRG's Value grade of D.

GLW 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 GLW is likely the superior value option right now.


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