Investors interested in Automotive - Domestic stocks are likely familiar with Blue Bird (BLBD) and Tesla (TSLA). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, Blue Bird is sporting a Zacks Rank of #2 (Buy), while Tesla has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BLBD likely has seen a stronger improvement to its earnings outlook than TSLA has recently. But this is just one factor that value investors are interested in.
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.
BLBD currently has a forward P/E ratio of 12.40, while TSLA has a forward P/E of 263.04. We also note that BLBD has a PEG ratio of 2.39. 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. TSLA currently has a PEG ratio of 10.15.
Another notable valuation metric for BLBD is its P/B ratio of 6.48. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, TSLA has a P/B of 17.74.
These metrics, and several others, help BLBD earn a Value grade of A, while TSLA has been given a Value grade of D.
BLBD stands above TSLA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BLBD is the superior value 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
Blue Bird Corporation (BLBD): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
