Yahoo Finance B vs. NDSN: Which Stock Is the Better Value Option?
Investors interested in stocks from the Manufacturing - General Industrial sector have probably already heard of Barnes Group (B) and Nordson (NDSN). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. 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.
Barnes Group and Nordson are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that B has an improving earnings outlook. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
B currently has a forward P/E ratio of 18.24, while NDSN has a forward P/E of 23.96. We also note that B has a PEG ratio of 1.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NDSN currently has a PEG ratio of 1.84.
Another notable valuation metric for B is its P/B ratio of 1.47. 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, NDSN has a P/B of 4.98.
These metrics, and several others, help B earn a Value grade of B, while NDSN has been given a Value grade of D.
B stands above NDSN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that B is the superior value option right now.
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Barnes Group, Inc. (B) : Free Stock Analysis Report
Nordson Corporation (NDSN) : Free Stock Analysis Report
