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ARCB or SAIA: Which Is the Better Value Stock Right Now?

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Investors with an interest in Transportation - Truck stocks have likely encountered both ArcBest (ARCB - Free Report) and Saia (SAIA - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

ArcBest and Saia are sporting Zacks Ranks of #1 (Strong Buy) and #2 (Buy), respectively, right now. This means that ARCB'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 analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

ARCB currently has a forward P/E ratio of 11.63, while SAIA has a forward P/E of 31.06. We also note that ARCB has a PEG ratio of 0.50. 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. SAIA currently has a PEG ratio of 1.04.

Another notable valuation metric for ARCB is its P/B ratio of 1.91. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, SAIA has a P/B of 5.98.

Based on these metrics and many more, ARCB holds a Value grade of A, while SAIA has a Value grade of D.

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


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