Investors interested in Engineering - R and D Services stocks are likely familiar with Sterling Infrastructure (STRL) and Quanta Services (PWR). But which of these two stocks presents investors with the better value opportunity right now? 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.

Sterling Infrastructure has a Zacks Rank of #2 (Buy), while Quanta Services has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that STRL is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

STRL currently has a forward P/E ratio of 18.76, while PWR has a forward P/E of 25.50. We also note that STRL has a PEG ratio of 1.25. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. PWR currently has a PEG ratio of 1.93.

Another notable valuation metric for STRL is its P/B ratio of 4.58. 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, PWR has a P/B of 5.22.

These are just a few of the metrics contributing to STRL's Value grade of B and PWR's Value grade of C.

STRL is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that STRL is likely the superior value option right now.

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This article originally published on Zacks Investment Research (zacks.com).

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