Back to top

Image: Bigstock

TTDKY vs. IIN: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors interested in stocks from the Electronics - Miscellaneous Components sector have probably already heard of TDK Corp. (TTDKY - Free Report) and IntriCon Corporation . 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

TDK Corp. has a Zacks Rank of #1 (Strong Buy), while IntriCon Corporation has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that TTDKY likely has seen a stronger improvement to its earnings outlook than IIN has recently. But this is just one factor that value investors are interested in.

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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

TTDKY currently has a forward P/E ratio of 13.42, while IIN has a forward P/E of 43.62. We also note that TTDKY has a PEG ratio of 0.88. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. IIN currently has a PEG ratio of 3.63.

Another notable valuation metric for TTDKY is its P/B ratio of 1.63. 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, IIN has a P/B of 1.67.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


TDK Corp. (TTDKY) - free report >>

Published in