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RBC Bearings Incorporated (RBC) - free report >>
Global X U.S. Cash Flow Kings 100 ETF (FLOW) - free report >>
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RBC Bearings Incorporated (RBC) - free report >>
Global X U.S. Cash Flow Kings 100 ETF (FLOW) - free report >>
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RBC or FLOW: Which Is the Better Value Stock Right Now?
Investors interested in Manufacturing - Electronics stocks are likely familiar with Regal Beloit (RBC - Free Report) and SPX Flow (FLOW - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Regal Beloit is sporting a Zacks Rank of #2 (Buy), while SPX Flow has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that RBC likely has seen a stronger improvement to its earnings outlook than FLOW has recently. However, value investors will care about much more than just this.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
RBC currently has a forward P/E ratio of 22.19, while FLOW has a forward P/E of 50.66. We also note that RBC has a PEG ratio of 2.22. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. FLOW currently has a PEG ratio of 9.36.
Another notable valuation metric for RBC is its P/B ratio of 2.04. 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, FLOW has a P/B of 2.38.
These metrics, and several others, help RBC earn a Value grade of B, while FLOW has been given a Value grade of C.
RBC stands above FLOW thanks to its solid earnings outlook, and based on these valuation figures, we also feel that RBC is the superior value option right now.