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TGLS vs. FAST: Which Stock Is the Better Value Option?

·2 min read

Investors with an interest in Building Products - Retail stocks have likely encountered both Tecnoglass (TGLS) and Fastenal (FAST). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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, Tecnoglass has a Zacks Rank of #2 (Buy), while Fastenal has a Zacks Rank of #3 (Hold). This means that TGLS'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 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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

TGLS currently has a forward P/E ratio of 7.41, while FAST has a forward P/E of 33.07. We also note that TGLS has a PEG ratio of 0.37. 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. FAST currently has a PEG ratio of 3.67.

Another notable valuation metric for TGLS is its P/B ratio of 1.63. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, FAST has a P/B of 9.66.

These are just a few of the metrics contributing to TGLS's Value grade of A and FAST's Value grade of D.

TGLS sticks out from FAST in both our Zacks Rank and Style Scores models, so value investors will likely feel that TGLS is the better option right now.


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Tecnoglass Inc. (TGLS) : Free Stock Analysis Report
 
Fastenal Company (FAST) : Free Stock Analysis Report
 
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Zacks Investment Research