MNRO vs. MCW: Which Stock Should Value Investors Buy Now?
Investors with an interest in Consumer Services - Miscellaneous stocks have likely encountered both Monro Muffler Brake (MNRO) and Mister Car Wash (MCW). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Monro Muffler Brake has a Zacks Rank of #2 (Buy), while Mister Car Wash has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MNRO 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 try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
MNRO currently has a forward P/E ratio of 22.22, while MCW has a forward P/E of 28.86. We also note that MNRO has a PEG ratio of 1.48. 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. MCW currently has a PEG ratio of 2.14.
Another notable valuation metric for MNRO is its P/B ratio of 1.78. 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, MCW has a P/B of 3.47.
Based on these metrics and many more, MNRO holds a Value grade of A, while MCW has a Value grade of C.
MNRO has seen stronger estimate revision activity and sports more attractive valuation metrics than MCW, so it seems like value investors will conclude that MNRO is the superior option right now.
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Monro Muffler Brake, Inc. (MNRO) : Free Stock Analysis Report
Mister Car Wash, Inc. (MCW) : Free Stock Analysis Report
