HOFT vs. WSC: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Furniture sector have probably already heard of Hooker Furniture (HOFT) and WillScot (WSC). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Hooker Furniture has a Zacks Rank of #1 (Strong Buy), while WillScot has a Zacks Rank of #3 (Hold) right now. This means that HOFT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.
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.
HOFT currently has a forward P/E ratio of 11.64, while WSC has a forward P/E of 21.14. We also note that HOFT has a PEG ratio of 0.83. 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. WSC currently has a PEG ratio of 0.84.
Another notable valuation metric for HOFT is its P/B ratio of 1.14. 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, WSC has a P/B of 7.10.
These metrics, and several others, help HOFT earn a Value grade of B, while WSC has been given a Value grade of C.
HOFT stands above WSC thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HOFT is the superior value option right now.
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Hooker Furnishings Corp. (HOFT) : Free Stock Analysis Report
WillScot Mobile Mini Holdings Corp. (WSC) : Free Stock Analysis Report
