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ACA vs. AWI: Which Stock Is the Better Value Option?
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Investors with an interest in Building Products - Miscellaneous stocks have likely encountered both Arcosa (ACA - Free Report) and Armstrong World Industries (AWI - Free Report) . 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.
Right now, Arcosa is sporting a Zacks Rank of #2 (Buy), while Armstrong World Industries has a Zacks Rank of #5 (Strong Sell). Investors should feel comfortable knowing that ACA likely has seen a stronger improvement to its earnings outlook than AWI has recently. However, value investors will care about much more than just this.
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.
ACA currently has a forward P/E ratio of 19.43, while AWI has a forward P/E of 20.85. We also note that ACA has a PEG ratio of 5.72. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AWI currently has a PEG ratio of 10.48.
Another notable valuation metric for ACA is its P/B ratio of 1.18. 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, AWI has a P/B of 8.87.
Based on these metrics and many more, ACA holds a Value grade of B, while AWI has a Value grade of D.
ACA sticks out from AWI in both our Zacks Rank and Style Scores models, so value investors will likely feel that ACA is the better option right now.
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ACA vs. AWI: Which Stock Is the Better Value Option?
Investors with an interest in Building Products - Miscellaneous stocks have likely encountered both Arcosa (ACA - Free Report) and Armstrong World Industries (AWI - Free Report) . 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.
Right now, Arcosa is sporting a Zacks Rank of #2 (Buy), while Armstrong World Industries has a Zacks Rank of #5 (Strong Sell). Investors should feel comfortable knowing that ACA likely has seen a stronger improvement to its earnings outlook than AWI has recently. However, value investors will care about much more than just this.
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.
ACA currently has a forward P/E ratio of 19.43, while AWI has a forward P/E of 20.85. We also note that ACA has a PEG ratio of 5.72. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AWI currently has a PEG ratio of 10.48.
Another notable valuation metric for ACA is its P/B ratio of 1.18. 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, AWI has a P/B of 8.87.
Based on these metrics and many more, ACA holds a Value grade of B, while AWI has a Value grade of D.
ACA sticks out from AWI in both our Zacks Rank and Style Scores models, so value investors will likely feel that ACA is the better option right now.