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ATEYY vs. ORBK: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Electronics - Measuring Instruments sector have probably already heard of Advantest Corp. (ATEYY - Free Report) and Orbotech . 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Advantest Corp. has a Zacks Rank of #2 (Buy), while Orbotech has a Zacks Rank of #4 (Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ATEYY is likely seeing its earnings outlook improve to a greater extent. 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

ATEYY currently has a forward P/E ratio of 9.02, while ORBK has a forward P/E of 16.03. We also note that ATEYY has a PEG ratio of 0.58. 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. ORBK currently has a PEG ratio of 0.92.

Another notable valuation metric for ATEYY is its P/B ratio of 2.73. 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, ORBK has a P/B of 2.77.

These are just a few of the metrics contributing to ATEYY's Value grade of B and ORBK's Value grade of D.

ATEYY has seen stronger estimate revision activity and sports more attractive valuation metrics than ORBK, so it seems like value investors will conclude that ATEYY is the superior option right now.


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