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ENS or EMR: Which Is the Better Value Stock Right Now?

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Investors interested in Manufacturing - Electronics stocks are likely familiar with EnerSys (ENS - Free Report) and Emerson Electric (EMR - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, EnerSys has a Zacks Rank of #2 (Buy), while Emerson Electric has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ENS 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 analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

ENS currently has a forward P/E ratio of 17.41, while EMR has a forward P/E of 18.23. We also note that ENS has a PEG ratio of 1.74. 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. EMR currently has a PEG ratio of 2.12.

Another notable valuation metric for ENS is its P/B ratio of 3.10. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, EMR has a P/B of 4.68.

Based on these metrics and many more, ENS holds a Value grade of A, while EMR has a Value grade of C.

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


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