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PCAR vs. FOXF: Which Stock Is the Better Value Option?

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Investors with an interest in Automotive - Domestic stocks have likely encountered both Paccar (PCAR - Free Report) and Fox Factory Holding (FOXF - 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, Paccar has a Zacks Rank of #2 (Buy), while Fox Factory Holding has a Zacks Rank of #4 (Sell). This means that PCAR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

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 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.

PCAR currently has a forward P/E ratio of 10.85, while FOXF has a forward P/E of 21.55. We also note that PCAR has a PEG ratio of 1.09. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FOXF currently has a PEG ratio of 1.93.

Another notable valuation metric for PCAR is its P/B ratio of 2.81. 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, FOXF has a P/B of 4.35.

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

PCAR stands above FOXF thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PCAR is the superior value option right now.


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PACCAR Inc. (PCAR) - free report >>

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