SKFRY or ESAB: Which Is the Better Value Stock Right Now?
Investors with an interest in Metal Products - Procurement and Fabrication stocks have likely encountered both AB SKF (SKFRY) and Esab (ESAB). 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
AB SKF has a Zacks Rank of #2 (Buy), while Esab 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 SKFRY is likely seeing its earnings outlook improve to a greater extent. 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.
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.
SKFRY currently has a forward P/E ratio of 12.38, while ESAB has a forward P/E of 21.02. We also note that SKFRY has a PEG ratio of 1.19. 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. ESAB currently has a PEG ratio of 1.77.
Another notable valuation metric for SKFRY is its P/B ratio of 1.62. 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, ESAB has a P/B of 3.52.
Based on these metrics and many more, SKFRY holds a Value grade of A, while ESAB has a Value grade of C.
SKFRY has seen stronger estimate revision activity and sports more attractive valuation metrics than ESAB, so it seems like value investors will conclude that SKFRY is the superior option right now.
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AB SKF (SKFRY) : Free Stock Analysis Report
ESAB Corporation (ESAB) : Free Stock Analysis Report