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ODP or TSCO: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Retail - Miscellaneous sector might want to consider either Office Depot (ODP - Free Report) or Tractor Supply (TSCO - 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.
Both Office Depot and Tractor Supply have 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 just one piece of the puzzle for value investors.
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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
ODP currently has a forward P/E ratio of 5.74, while TSCO has a forward P/E of 23.21. We also note that ODP has a PEG ratio of 0.48. 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. TSCO currently has a PEG ratio of 2.04.
Another notable valuation metric for ODP is its P/B ratio of 0.52. 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, TSCO has a P/B of 8.98.
Based on these metrics and many more, ODP holds a Value grade of A, while TSCO has a Value grade of C.
Both ODP and TSCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ODP is the superior value option right now.
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ODP or TSCO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Retail - Miscellaneous sector might want to consider either Office Depot (ODP - Free Report) or Tractor Supply (TSCO - 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.
Both Office Depot and Tractor Supply have 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 just one piece of the puzzle for value investors.
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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
ODP currently has a forward P/E ratio of 5.74, while TSCO has a forward P/E of 23.21. We also note that ODP has a PEG ratio of 0.48. 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. TSCO currently has a PEG ratio of 2.04.
Another notable valuation metric for ODP is its P/B ratio of 0.52. 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, TSCO has a P/B of 8.98.
Based on these metrics and many more, ODP holds a Value grade of A, while TSCO has a Value grade of C.
Both ODP and TSCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ODP is the superior value option right now.