Credit: Shutterstock photoInvestors interested in stocks from the Transportation - Services sector have probably already heard of Matson (MATX) and Grupo Aeroportuario del Pacifico (PAC). But which of these two companies is the best option for those looking for undervalued stocks? 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Matson has a Zacks Rank of #2 (Buy), while Grupo Aeroportuario del Pacifico has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that MATX likely has seen a stronger improvement to its earnings outlook than PAC has recently. But this is only part of the picture for value investors.
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.
MATX currently has a forward P/E ratio of 17.05, while PAC has a forward P/E of 23.27. We also note that MATX has a PEG ratio of 3.41. 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. PAC currently has a PEG ratio of 3.94.
Another notable valuation metric for MATX is its P/B ratio of 2.45. 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, PAC has a P/B of 5.88.
These metrics, and several others, help MATX earn a Value grade of A, while PAC has been given a Value grade of D.
MATX stands above PAC thanks to its solid earnings outlook, and based on these valuation figures, we also feel that MATX is the superior value option right now.
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Matson, Inc. (MATX): Free Stock Analysis Report
Grupo Aeroportuario Del Pacifico, S.A. de C.V. (PAC): 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.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
