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SHYF or RACE: Which Is the Better Value Stock Right Now?

Zacks Equity Research
·2-min read

Investors interested in Automotive - Original Equipment stocks are likely familiar with The Shyft Group (SHYF) and Ferrari (RACE). 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, The Shyft Group has a Zacks Rank of #2 (Buy), while Ferrari has a Zacks Rank of #4 (Sell). This means that SHYF's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

SHYF currently has a forward P/E ratio of 16.47, while RACE has a forward P/E of 57.87. We also note that SHYF has a PEG ratio of 1.10. 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. RACE currently has a PEG ratio of 4.96.

Another notable valuation metric for SHYF is its P/B ratio of 3.42. 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, RACE has a P/B of 18.88.

Based on these metrics and many more, SHYF holds a Value grade of B, while RACE has a Value grade of F.

SHYF sticks out from RACE in both our Zacks Rank and Style Scores models, so value investors will likely feel that SHYF is the better option right now.


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Spartan Motors, Inc. (SHYF) : Free Stock Analysis Report
 
Ferrari N.V. (RACE) : Free Stock Analysis Report
 
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Zacks Investment Research