Yahoo Finance SRCL or WM: Which Is the Better Value Stock Right Now?
Investors interested in Waste Removal Services stocks are likely familiar with Stericycle (SRCL) and Waste Management (WM). 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.
Stericycle has a Zacks Rank of #2 (Buy), while Waste Management has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that SRCL is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
SRCL currently has a forward P/E ratio of 21.67, while WM has a forward P/E of 30.34. We also note that SRCL has a PEG ratio of 2.71. 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. WM currently has a PEG ratio of 3.17.
Another notable valuation metric for SRCL is its P/B ratio of 1.85. 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, WM has a P/B of 12.19.
These are just a few of the metrics contributing to SRCL's Value grade of B and WM's Value grade of C.
SRCL sticks out from WM in both our Zacks Rank and Style Scores models, so value investors will likely feel that SRCL is the better option right now.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Stericycle, Inc. (SRCL) : Free Stock Analysis Report
Waste Management, Inc. (WM) : Free Stock Analysis Report
