HOG vs. FOXF: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Automotive - Domestic sector have probably already heard of Harley-Davidson (HOG) and Fox Factory Holding (FOXF). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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, Harley-Davidson has a Zacks Rank of #1 (Strong Buy), while Fox Factory Holding has a Zacks Rank of #2 (Buy). This means that HOG'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 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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
HOG currently has a forward P/E ratio of 14.22, while FOXF has a forward P/E of 35.91. We also note that HOG has a PEG ratio of 2.37. 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. FOXF currently has a PEG ratio of 2.72.
Another notable valuation metric for HOG is its P/B ratio of 3.46. 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, FOXF has a P/B of 7.53.
These metrics, and several others, help HOG earn a Value grade of B, while FOXF has been given a Value grade of F.
HOG stands above FOXF thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HOG is the superior value option right now.
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HarleyDavidson, Inc. (HOG) : Free Stock Analysis Report
Fox Factory Holding Corp. (FOXF) : Free Stock Analysis Report
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