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ARKAY vs. AIQUY: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Chemical - Diversified sector might want to consider either Arkema SA (ARKAY - Free Report) or Air Liquide (AIQUY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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.

Right now, both Arkema SA and Air Liquide are sporting a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is only part of the picture for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

ARKAY currently has a forward P/E ratio of 14.84, while AIQUY has a forward P/E of 27.78. We also note that ARKAY has a PEG ratio of 0.57. 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. AIQUY currently has a PEG ratio of 4.83.

Another notable valuation metric for ARKAY is its P/B ratio of 1.47. 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, AIQUY has a P/B of 3.85.

These are just a few of the metrics contributing to ARKAY's Value grade of A and AIQUY's Value grade of D.

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


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