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ARKAY or AKZOY: Which Is the Better Value Stock Right Now?

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Investors with an interest in Chemical - Diversified stocks have likely encountered both Arkema SA (ARKAY - Free Report) and Akzo Nobel NV (AKZOY - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Arkema SA has a Zacks Rank of #2 (Buy), while Akzo Nobel NV has a Zacks Rank of #4 (Sell) right now. This means that ARKAY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

ARKAY currently has a forward P/E ratio of 9.80, while AKZOY has a forward P/E of 19.68. We also note that ARKAY has a PEG ratio of 3.03. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. AKZOY currently has a PEG ratio of 5.47.

Another notable valuation metric for ARKAY is its P/B ratio of 0.91. 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, AKZOY has a P/B of 2.77.

These are just a few of the metrics contributing to ARKAY's Value grade of A and AKZOY's Value grade of D.

ARKAY sticks out from AKZOY in both our Zacks Rank and Style Scores models, so value investors will likely feel that ARKAY is the better option right now.


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