BRC or ALLE: Which Is the Better Value Stock Right Now?

ALLE BRC

Investors interested in Security and Safety Services stocks are likely familiar with Brady (BRC - Free Report) and Allegion (ALLE - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Both Brady and Allegion have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.

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 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.

BRC currently has a forward P/E ratio of 13.96, while ALLE has a forward P/E of 17.87. We also note that BRC has a PEG ratio of 1.99. 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. ALLE currently has a PEG ratio of 2.94.

Another notable valuation metric for BRC is its P/B ratio of 2.43. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, ALLE has a P/B of 9.97.

Based on these metrics and many more, BRC holds a Value grade of B, while ALLE has a Value grade of C.

Both BRC and ALLE are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BRC is the superior value option right now.

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