Investors with an interest in Chemical - Diversified stocks have likely encountered both Dow Inc. (DOW - Free Report) and Koninklijke DSM NV . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Dow Inc. has a Zacks Rank of #2 (Buy), while Koninklijke DSM NV has a Zacks Rank of #5 (Strong Sell). Investors should feel comfortable knowing that DOW likely has seen a stronger improvement to its earnings outlook than RDSMY has recently. But this is only part of the picture for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.
DOW currently has a forward P/E ratio of 8.38, while RDSMY has a forward P/E of 28.65. We also note that DOW has a PEG ratio of 0.28. 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. RDSMY currently has a PEG ratio of 2.66.
Another notable valuation metric for DOW is its P/B ratio of 2.57. 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, RDSMY has a P/B of 2.84.
Based on these metrics and many more, DOW holds a Value grade of A, while RDSMY has a Value grade of D.
DOW sticks out from RDSMY in both our Zacks Rank and Style Scores models, so value investors will likely feel that DOW is the better option right now.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Investors with an interest in Chemical - Diversified stocks have likely encountered both Dow Inc. (DOW - Free Report) and Koninklijke DSM NV . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Dow Inc. has a Zacks Rank of #2 (Buy), while Koninklijke DSM NV has a Zacks Rank of #5 (Strong Sell). Investors should feel comfortable knowing that DOW likely has seen a stronger improvement to its earnings outlook than RDSMY has recently. But this is only part of the picture for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.
DOW currently has a forward P/E ratio of 8.38, while RDSMY has a forward P/E of 28.65. We also note that DOW has a PEG ratio of 0.28. 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. RDSMY currently has a PEG ratio of 2.66.
Another notable valuation metric for DOW is its P/B ratio of 2.57. 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, RDSMY has a P/B of 2.84.
Based on these metrics and many more, DOW holds a Value grade of A, while RDSMY has a Value grade of D.
DOW sticks out from RDSMY in both our Zacks Rank and Style Scores models, so value investors will likely feel that DOW is the better option right now.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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