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REVG vs. ASR: Which Stock Is the Better Value Option?

Zacks Equity Research
American Woodmark (AMWD) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Investors looking for stocks in the Transportation - Services sector might want to consider either REV Group, Inc. (REVG) or Grupo Aeroportuario del Sureste (ASR). But which of these two stocks presents investors with the better value opportunity right now? Let's 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.

Both REV Group, Inc. and Grupo Aeroportuario del Sureste have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. 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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

REVG currently has a forward P/E ratio of 7.93, while ASR has a forward P/E of 18.59. We also note that REVG has a PEG ratio of 1.32. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ASR currently has a PEG ratio of 4.23.

Another notable valuation metric for REVG is its P/B ratio of 1.08. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, ASR has a P/B of 2.45.

These metrics, and several others, help REVG earn a Value grade of A, while ASR has been given a Value grade of C.

Both REVG and ASR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that REVG is the superior value option right now.


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REV Group, Inc. (REVG) : Free Stock Analysis Report
 
Grupo Aeroportuario del Sureste, S.A. de C.V. (ASR) : Free Stock Analysis Report
 
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