Investors interested in Transportation - Services stocks are likely familiar with Schneider National (SNDR) and ZTO Express Cayman Inc. (ZTO). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Schneider National is sporting a Zacks Rank of #1 (Strong Buy), while ZTO Express Cayman Inc. has a Zacks Rank of #4 (Sell). This means that SNDR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
SNDR currently has a forward P/E ratio of 11.97, while ZTO has a forward P/E of 32.74. We also note that SNDR has a PEG ratio of 0.67. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ZTO currently has a PEG ratio of 2.48.
Another notable valuation metric for SNDR is its P/B ratio of 1.98. 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, ZTO has a P/B of 2.27.
Based on these metrics and many more, SNDR holds a Value grade of B, while ZTO has a Value grade of C.
SNDR has seen stronger estimate revision activity and sports more attractive valuation metrics than ZTO, so it seems like value investors will conclude that SNDR is the superior option right now.
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Schneider National, Inc. (SNDR) : Free Stock Analysis Report
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