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ARCB vs. SAIA: Which Stock Should Value Investors Buy Now?

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Investors interested in Transportation - Truck stocks are likely familiar with ArcBest (ARCB - Free Report) and Saia (SAIA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

ArcBest has a Zacks Rank of #1 (Strong Buy), while Saia has a Zacks Rank of #2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ARCB is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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 7.71, while SAIA has a forward P/E of 20.51. We also note that ARCB has a PEG ratio of 0.20. 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. SAIA currently has a PEG ratio of 0.98.

Another notable valuation metric for ARCB is its P/B ratio of 2.25. 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, SAIA has a P/B of 5.42.

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

ARCB 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 ARCB is likely the superior value option right now.


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