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SMP or CARG: Which Is the Better Value Stock Right Now?
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Investors interested in Automotive - Replacement Parts stocks are likely familiar with Standard Motor Products (SMP - Free Report) and CarGurus (CARG - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Standard Motor Products and CarGurus have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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.
SMP currently has a forward P/E ratio of 15.13, while CARG has a forward P/E of 87.76. We also note that SMP has a PEG ratio of 1.38. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CARG currently has a PEG ratio of 2.25.
Another notable valuation metric for SMP is its P/B ratio of 2.13. 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, CARG has a P/B of 19.54.
Based on these metrics and many more, SMP holds a Value grade of A, while CARG has a Value grade of F.
Both SMP and CARG are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that SMP is the superior value option right now.
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SMP or CARG: Which Is the Better Value Stock Right Now?
Investors interested in Automotive - Replacement Parts stocks are likely familiar with Standard Motor Products (SMP - Free Report) and CarGurus (CARG - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Standard Motor Products and CarGurus have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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.
SMP currently has a forward P/E ratio of 15.13, while CARG has a forward P/E of 87.76. We also note that SMP has a PEG ratio of 1.38. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CARG currently has a PEG ratio of 2.25.
Another notable valuation metric for SMP is its P/B ratio of 2.13. 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, CARG has a P/B of 19.54.
Based on these metrics and many more, SMP holds a Value grade of A, while CARG has a Value grade of F.
Both SMP and CARG are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that SMP is the superior value option right now.