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BASFY vs. APD: Which Stock Should Value Investors Buy Now?

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Investors interested in Chemical - Diversified stocks are likely familiar with BASF SE (BASFY - Free Report) and Air Products and Chemicals (APD - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, BASF SE has a Zacks Rank of #2 (Buy), while Air Products and Chemicals has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that BASFY has an improving earnings outlook. But this is only part of the picture 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.

BASFY currently has a forward P/E ratio of 16.41, while APD has a forward P/E of 29.11. We also note that BASFY has a PEG ratio of 2.43. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. APD currently has a PEG ratio of 3.55.

Another notable valuation metric for BASFY is its P/B ratio of 1.84. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, APD has a P/B of 4.45.

These metrics, and several others, help BASFY earn a Value grade of B, while APD has been given a Value grade of C.

BASFY stands above APD thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BASFY is the superior value option right now.


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