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SP vs. MNRO: Which Stock Is the Better Value Option?

Zacks Equity Research
Merck (MRK) closed the most recent trading day at $81.59, moving +0.78% from the previous trading session.

Investors interested in stocks from the Consumer Services - Miscellaneous sector have probably already heard of SP Plus (SP) and Monro Muffler Brake (MNRO). 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.

SP Plus and Monro Muffler Brake are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that SP likely has seen a stronger improvement to its earnings outlook than MNRO has recently. 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.

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.

SP currently has a forward P/E ratio of 13.25, while MNRO has a forward P/E of 31.45. We also note that SP has a PEG ratio of 1.32. 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. MNRO currently has a PEG ratio of 2.52.

Another notable valuation metric for SP is its P/B ratio of 2.13. 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, MNRO has a P/B of 4.02.

These are just a few of the metrics contributing to SP's Value grade of B and MNRO's Value grade of D.

SP stands above MNRO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SP is the superior value option right now.


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SP Plus Corporation (SP) : Free Stock Analysis Report
 
Monro Muffler Brake, Inc. (MNRO) : Free Stock Analysis Report
 
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