Yahoo Finance STRL vs. HWM: Which Stock Is the Better Value Option?
Investors interested in Engineering - R and D Services stocks are likely familiar with Sterling Infrastructure (STRL) and Howmet (HWM). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Sterling Infrastructure has a Zacks Rank of #1 (Strong Buy), while Howmet has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that STRL is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture 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.
STRL currently has a forward P/E ratio of 20.02, while HWM has a forward P/E of 29.35. We also note that STRL has a PEG ratio of 1. 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. HWM currently has a PEG ratio of 1.67.
Another notable valuation metric for STRL is its P/B ratio of 4.94. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, HWM has a P/B of 6.62.
These are just a few of the metrics contributing to STRL's Value grade of B and HWM's Value grade of D.
STRL stands above HWM thanks to its solid earnings outlook, and based on these valuation figures, we also feel that STRL is the superior value option right now.
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Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report
Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report
