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ZWS or ETN: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Manufacturing - Electronics sector might want to consider either Zurn Water (ZWS - Free Report) or Eaton (ETN - Free Report) . 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Zurn Water has a Zacks Rank of #2 (Buy), while Eaton has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ZWS has an improving earnings outlook. But this is just one piece of the puzzle 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
ZWS currently has a forward P/E ratio of 32.51, while ETN has a forward P/E of 33.51. We also note that ZWS has a PEG ratio of 2.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ETN currently has a PEG ratio of 2.74.
Another notable valuation metric for ZWS is its P/B ratio of 4.32. 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, ETN has a P/B of 7.46.
These are just a few of the metrics contributing to ZWS's Value grade of B and ETN's Value grade of C.
ZWS has seen stronger estimate revision activity and sports more attractive valuation metrics than ETN, so it seems like value investors will conclude that ZWS is the superior option right now.
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ZWS or ETN: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Manufacturing - Electronics sector might want to consider either Zurn Water (ZWS - Free Report) or Eaton (ETN - Free Report) . 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Zurn Water has a Zacks Rank of #2 (Buy), while Eaton has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ZWS has an improving earnings outlook. But this is just one piece of the puzzle 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
ZWS currently has a forward P/E ratio of 32.51, while ETN has a forward P/E of 33.51. We also note that ZWS has a PEG ratio of 2.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ETN currently has a PEG ratio of 2.74.
Another notable valuation metric for ZWS is its P/B ratio of 4.32. 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, ETN has a P/B of 7.46.
These are just a few of the metrics contributing to ZWS's Value grade of B and ETN's Value grade of C.
ZWS has seen stronger estimate revision activity and sports more attractive valuation metrics than ETN, so it seems like value investors will conclude that ZWS is the superior option right now.