GPI or CRMT: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Automotive - Retail and Whole Sales sector might want to consider either Group 1 Automotive (GPI) or America's Car-Mart (CRMT). 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.
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.
Group 1 Automotive and America's Car-Mart are both sporting a Zacks Rank of # 1 (Strong Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
GPI currently has a forward P/E ratio of 7.86, while CRMT has a forward P/E of 9.82. We also note that GPI has a PEG ratio of 1. 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. CRMT currently has a PEG ratio of 1.17.
Another notable valuation metric for GPI is its P/B ratio of 1.85. 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, CRMT has a P/B of 1.98.
These metrics, and several others, help GPI earn a Value grade of A, while CRMT has been given a Value grade of C.
Both GPI and CRMT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that GPI is the superior value option right now.
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Group 1 Automotive, Inc. (GPI): Free Stock Analysis Report
Americas CarMart, Inc. (CRMT): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.