Back to top

Image: Bigstock

MPTI vs. HWM: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors looking for stocks in the Engineering - R and D Services sector might want to consider either M-tron Industries, Inc. (MPTI - Free Report) or Howmet (HWM - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.

M-tron Industries, Inc. and Howmet are both sporting a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.

MPTI currently has a forward P/E ratio of 15.31, while HWM has a forward P/E of 36.43. We also note that MPTI has a PEG ratio of 0.67. 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. HWM currently has a PEG ratio of 1.41.

Another notable valuation metric for MPTI is its P/B ratio of 4.09. 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, HWM has a P/B of 9.12.

These metrics, and several others, help MPTI earn a Value grade of B, while HWM has been given a Value grade of D.

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Howmet Aerospace Inc. (HWM) - free report >>

M-tron Industries, Inc. (MPTI) - free report >>

Published in