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HCCI or CWST: Which Is the Better Value Stock Right Now?

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Investors interested in Pollution Control stocks are likely familiar with Heritage-Crystal Clean and Casella (CWST - 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.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Heritage-Crystal Clean has a Zacks Rank of #2 (Buy), while Casella has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that HCCI is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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 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.

HCCI currently has a forward P/E ratio of 9.16, while CWST has a forward P/E of 76.06. We also note that HCCI has a PEG ratio of 0.61. 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. CWST currently has a PEG ratio of 3.60.

Another notable valuation metric for HCCI is its P/B ratio of 1.83. 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, CWST has a P/B of 9.03.

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

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


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