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KRYAY vs. NSRGY: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Food - Miscellaneous sector might want to consider either Kerry Group PLC (KRYAY - Free Report) or Nestle SA (NSRGY - Free Report) . 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Kerry Group PLC has a Zacks Rank of #2 (Buy), while Nestle SA has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that KRYAY is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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.

KRYAY currently has a forward P/E ratio of 21.04, while NSRGY has a forward P/E of 24.11. We also note that KRYAY has a PEG ratio of 1.66. 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. NSRGY currently has a PEG ratio of 2.72.

Another notable valuation metric for KRYAY is its P/B ratio of 2.57. 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, NSRGY has a P/B of 5.58.

Based on these metrics and many more, KRYAY holds a Value grade of B, while NSRGY has a Value grade of C.

KRYAY stands above NSRGY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that KRYAY is the superior value option right now.


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