STRT vs. MBLY: Which Stock Offers the Better Value Today? - NEW BOX OFFICE TO DAY

Investors interested in stocks from the Automotive - Original Equipment sector have probably already heard of Strattec Security (STRT) and Mobileye Global (MBLY). But which of these two stocks presents investors with the better value opportunity right now? 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, Strattec Security is sporting a Zacks Rank of #1 (Strong Buy), while Mobileye Global has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that STRT likely has seen a stronger improvement to its earnings outlook than MBLY 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.

The Value segment within the Style Scores framework pinpoints underpriced firms by examining several crucial indicators. Among these are traditional measures such as the price-to-earnings (P/E) ratio, price-to-sales (P/S) ratio, earnings yield, cash flow per share, along with various additional fundamental factors aimed at assessing a company’s true worth.

Currently, STRT boasts a forward P/E ratio of 9.93, whereas MBLY holds one at 59.97. Additionally, we observe that STRT’s PEG ratio stands at 0.99. Similar to the standard P/E metric but including projected earning growth rates, this ratio provides more insight into future prospects. On the other hand, MBLY reports a higher PEG ratio of 3.09.

A significant valuation measure for STRT is its price-to-book (P/B) ratio, standing at 0.78. This metric evaluates a company’s market value relative to its book value—calculated as total assets less total liabilities. In contrast, MBLY boasts a P/B ratio of 1.14.

Using these metrics and numerous others, STRT receives an A for its Value grade, whereas MBLY gets an F in the same category.

Currently, STRT has an enhancing earnings forecast, setting it apart within our Zacks Rank framework. Additionally, considering these valuation indicators, we believe that STRT presents itself as the more attractive value choice at present.

The article was initially published on Zacks Investment Research (romero.my.id).