Yahoo Finance TTDKY or NJDCY: Which Is the Better Value Stock Right Now?
Investors with an interest in Electronics - Miscellaneous Components stocks have likely encountered both TDK Corp. (TTDKY) and Nidec Corp. (NJDCY). 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 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.
TDK Corp. and Nidec Corp. are sporting Zacks Ranks of #2 (Buy) and #5 (Strong Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TTDKY is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
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.
TTDKY currently has a forward P/E ratio of 12.65, while NJDCY has a forward P/E of 26.18. We also note that TTDKY has a PEG ratio of 0.71. 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. NJDCY currently has a PEG ratio of 1.65.
Another notable valuation metric for TTDKY is its P/B ratio of 1.38. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, NJDCY has a P/B of 3.01.
These are just a few of the metrics contributing to TTDKY's Value grade of A and NJDCY's Value grade of D.
TTDKY 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 TTDKY is likely the superior value option right now.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
TDK Corp. (TTDKY) : Free Stock Analysis Report
Nidec Corp. (NJDCY) : Free Stock Analysis Report
