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ARKAY or AIQUY: Which Is the Better Value Stock Right Now?

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Investors with an interest in Chemical - Diversified stocks have likely encountered both Arkema SA (ARKAY - Free Report) and 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.

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.

Arkema SA and Air Liquide are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that ARKAY likely has seen a stronger improvement to its earnings outlook than AIQUY has recently. 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.

ARKAY currently has a forward P/E ratio of 11.30, while AIQUY has a forward P/E of 26.95. We also note that ARKAY has a PEG ratio of 0.35. 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 4.24.

Another notable valuation metric for ARKAY is its P/B ratio of 1.53. 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 3.42.

Based on these metrics and many more, ARKAY holds a Value grade of A, while AIQUY has a Value grade of C.

ARKAY has seen stronger estimate revision activity and sports more attractive valuation metrics than AIQUY, so it seems like value investors will conclude that ARKAY is the superior option right now.


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