Yahoo Finance AZZ or ABBNY: Which Is the Better Value Stock Right Now?
Investors interested in Manufacturing - Electronics stocks are likely familiar with AZZ (AZZ) and ABB (ABBNY). 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, AZZ has a Zacks Rank of #2 (Buy), while ABB has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that AZZ likely has seen a stronger improvement to its earnings outlook than ABBNY has recently. 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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
AZZ currently has a forward P/E ratio of 16.56, while ABBNY has a forward P/E of 22.39. We also note that AZZ has a PEG ratio of 1.18. 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. ABBNY currently has a PEG ratio of 3.61.
Another notable valuation metric for AZZ is its P/B ratio of 2.08. 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, ABBNY has a P/B of 6.14.
These are just a few of the metrics contributing to AZZ's Value grade of A and ABBNY's Value grade of C.
AZZ 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 AZZ is likely the superior value option right now.
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AZZ Inc. (AZZ) : Free Stock Analysis Report
ABB Ltd (ABBNY) : Free Stock Analysis Report
