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KMTUY or CAT: Which Is the Better Value Stock Right Now?
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Investors with an interest in Manufacturing - Construction and Mining stocks have likely encountered both Komatsu Ltd. (KMTUY - Free Report) and Caterpillar (CAT - Free Report) . 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.
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 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.
Komatsu Ltd. has a Zacks Rank of #1 (Strong Buy), while Caterpillar has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that KMTUY is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
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.
KMTUY currently has a forward P/E ratio of 8.82, while CAT has a forward P/E of 16.76. We also note that KMTUY has a PEG ratio of 1.37. 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. CAT currently has a PEG ratio of 1.40.
Another notable valuation metric for KMTUY is its P/B ratio of 1.14. 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, CAT has a P/B of 8.54.
Based on these metrics and many more, KMTUY holds a Value grade of B, while CAT has a Value grade of C.
KMTUY sticks out from CAT in both our Zacks Rank and Style Scores models, so value investors will likely feel that KMTUY is the better option right now.
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KMTUY or CAT: Which Is the Better Value Stock Right Now?
Investors with an interest in Manufacturing - Construction and Mining stocks have likely encountered both Komatsu Ltd. (KMTUY - Free Report) and Caterpillar (CAT - Free Report) . 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.
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 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.
Komatsu Ltd. has a Zacks Rank of #1 (Strong Buy), while Caterpillar has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that KMTUY is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
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.
KMTUY currently has a forward P/E ratio of 8.82, while CAT has a forward P/E of 16.76. We also note that KMTUY has a PEG ratio of 1.37. 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. CAT currently has a PEG ratio of 1.40.
Another notable valuation metric for KMTUY is its P/B ratio of 1.14. 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, CAT has a P/B of 8.54.
Based on these metrics and many more, KMTUY holds a Value grade of B, while CAT has a Value grade of C.
KMTUY sticks out from CAT in both our Zacks Rank and Style Scores models, so value investors will likely feel that KMTUY is the better option right now.