Yahoo Finance FELE or ABBNY: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Manufacturing - Electronics sector have probably already heard of Franklin Electric (FELE) 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.
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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, both Franklin Electric and ABB are sporting a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. 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 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.
FELE currently has a forward P/E ratio of 22.14, while ABBNY has a forward P/E of 22.29. We also note that FELE has a PEG ratio of 1.84. 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. ABBNY currently has a PEG ratio of 3.59.
Another notable valuation metric for FELE is its P/B ratio of 4.07. 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 5.72.
These metrics, and several others, help FELE earn a Value grade of B, while ABBNY has been given a Value grade of C.
Both FELE and ABBNY are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that FELE is the superior value option right now.
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Franklin Electric Co., Inc. (FELE) : Free Stock Analysis Report
ABB Ltd (ABBNY) : Free Stock Analysis Report
