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IBP vs. JHX: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Building Products - Miscellaneous sector might want to consider either Installed Building Products (IBP - Free Report) or James Hardie (JHX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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.
Right now, Installed Building Products is sporting a Zacks Rank of #2 (Buy), while James Hardie has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that IBP 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.
IBP currently has a forward P/E ratio of 12.86, while JHX has a forward P/E of 18.67. We also note that IBP has a PEG ratio of 1.61. 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. JHX currently has a PEG ratio of 2.45.
Another notable valuation metric for IBP is its P/B ratio of 6.34. 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, JHX has a P/B of 6.88.
Based on these metrics and many more, IBP holds a Value grade of A, while JHX has a Value grade of C.
IBP has seen stronger estimate revision activity and sports more attractive valuation metrics than JHX, so it seems like value investors will conclude that IBP is the superior option right now.
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IBP vs. JHX: Which Stock Is the Better Value Option?
Investors looking for stocks in the Building Products - Miscellaneous sector might want to consider either Installed Building Products (IBP - Free Report) or James Hardie (JHX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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.
Right now, Installed Building Products is sporting a Zacks Rank of #2 (Buy), while James Hardie has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that IBP 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.
IBP currently has a forward P/E ratio of 12.86, while JHX has a forward P/E of 18.67. We also note that IBP has a PEG ratio of 1.61. 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. JHX currently has a PEG ratio of 2.45.
Another notable valuation metric for IBP is its P/B ratio of 6.34. 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, JHX has a P/B of 6.88.
Based on these metrics and many more, IBP holds a Value grade of A, while JHX has a Value grade of C.
IBP has seen stronger estimate revision activity and sports more attractive valuation metrics than JHX, so it seems like value investors will conclude that IBP is the superior option right now.