Investors interested in stocks from the Automotive - Original Equipment sector have probably already heard of Strattec Security (STRT) and Ferrari (RACE). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Right now, Strattec Security is sporting a Zacks Rank of #2 (Buy), while Ferrari has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that STRT is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

STRT currently has a forward P/E ratio of 18.44, while RACE has a forward P/E of 55.12. We also note that STRT has a PEG ratio of 1.84. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. RACE currently has a PEG ratio of 5.06.

Another notable valuation metric for STRT is its P/B ratio of 0.66. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, RACE has a P/B of 32.12.

These are just a few of the metrics contributing to STRT's Value grade of A and RACE's Value grade of C.

STRT stands above RACE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that STRT is the superior value option right now.

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Strattec Security Corporation (STRT) : Free Stock Analysis Report