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KBR or RTOXY: Which Is the Better Value Stock Right Now?

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Investors with an interest in Engineering - R and D Services stocks have likely encountered both KBR Inc. (KBR - Free Report) and ROTORK PLC . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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.

KBR Inc. and ROTORK PLC are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that KBR likely has seen a stronger improvement to its earnings outlook than RTOXY has recently. 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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

KBR currently has a forward P/E ratio of 12.92, while RTOXY has a forward P/E of 23.72. We also note that KBR has a PEG ratio of 1.44. 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. RTOXY currently has a PEG ratio of 2.06.

Another notable valuation metric for KBR is its P/B ratio of 1.65. 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, RTOXY has a P/B of 5.13.

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

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


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