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

Zacks Equity Research
Tilly's (TLYS) closed the most recent trading day at $16.18, moving -0.98% from the previous trading session.

Investors looking for stocks in the Building Products - Retail sector might want to consider either Tecnoglass (TGLS) or Lumber Liquidators Holdings (LL). 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.

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, Tecnoglass is sporting a Zacks Rank of #2 (Buy), while Lumber Liquidators Holdings has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TGLS has an improving earnings outlook. But this is just one piece of the puzzle 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 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 13.97, while LL has a forward P/E of 27.40. We also note that TGLS has a PEG ratio of 0.70. 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. LL currently has a PEG ratio of 1.

Another notable valuation metric for TGLS is its P/B ratio of 2.36. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, LL has a P/B of 2.65.

These metrics, and several others, help TGLS earn a Value grade of B, while LL has been given a Value grade of C.

TGLS is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TGLS is likely the superior value option right now.


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Tecnoglass Inc. (TGLS) : Free Stock Analysis Report
 
Lumber Liquidators Holdings, Inc (LL) : Free Stock Analysis Report
 
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