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ADRNY or CHWY: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Consumer Products - Staples sector have probably already heard of Ahold NV (ADRNY - Free Report) and Chewy (CHWY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Ahold NV has a Zacks Rank of #2 (Buy), while Chewy has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that ADRNY likely has seen a stronger improvement to its earnings outlook than CHWY has recently. However, value investors will care about much more than just this.

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.

ADRNY currently has a forward P/E ratio of 13.70, while CHWY has a forward P/E of 1,009.87. We also note that ADRNY has a PEG ratio of 3.93. 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. CHWY currently has a PEG ratio of 50.49.

Another notable valuation metric for ADRNY is its P/B ratio of 2.26. 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, CHWY has a P/B of 424.81.

These metrics, and several others, help ADRNY earn a Value grade of A, while CHWY has been given a Value grade of D.

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


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