Yahoo Finance CECO or CWST: Which Is the Better Value Stock Right Now?
Investors interested in Pollution Control stocks are likely familiar with CECO Environmental (CECO) and Casella (CWST). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 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.
CECO Environmental has a Zacks Rank of #2 (Buy), while Casella has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that CECO likely has seen a stronger improvement to its earnings outlook than CWST has recently. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
CECO currently has a forward P/E ratio of 14.73, while CWST has a forward P/E of 60.80. We also note that CECO has a PEG ratio of 0.98. 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. CWST currently has a PEG ratio of 3.28.
Another notable valuation metric for CECO is its P/B ratio of 2.33. 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, CWST has a P/B of 8.41.
These metrics, and several others, help CECO earn a Value grade of B, while CWST has been given a Value grade of D.
CECO sticks out from CWST in both our Zacks Rank and Style Scores models, so value investors will likely feel that CECO is the better option right now.
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CECO Environmental Corp. (CECO) : Free Stock Analysis Report
Casella Waste Systems, Inc. (CWST) : Free Stock Analysis Report
