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GBX or WAB: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Transportation - Equipment and Leasing sector have probably already heard of Greenbrier Companies (GBX - Free Report) and Westinghouse Air Brake Technologies (WAB - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.

Both Greenbrier Companies and Westinghouse Air Brake Technologies have a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. 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.

GBX currently has a forward P/E ratio of 11.05, while WAB has a forward P/E of 22.50. We also note that GBX has a PEG ratio of 0.59. 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. WAB currently has a PEG ratio of 1.40.

Another notable valuation metric for GBX is its P/B ratio of 1.03. 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, WAB has a P/B of 2.80.

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

Both GBX and WAB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that GBX is the superior value option right now.


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Greenbrier Companies, Inc. (The) (GBX) - free report >>

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