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

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Investors interested in Electronics - Miscellaneous Components stocks are likely familiar with TDK Corp. (TTDKY - Free Report) and TE Connectivity (TEL - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, TDK Corp. is sporting a Zacks Rank of #1 (Strong Buy), while TE Connectivity has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that TTDKY likely has seen a stronger improvement to its earnings outlook than TEL has recently. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

TTDKY currently has a forward P/E ratio of 11.35, while TEL has a forward P/E of 17.77. We also note that TTDKY has a PEG ratio of 1.05. 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. TEL currently has a PEG ratio of 2.48.

Another notable valuation metric for TTDKY is its P/B ratio of 1.19. 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, TEL has a P/B of 3.59.

These are just a few of the metrics contributing to TTDKY's Value grade of A and TEL's Value grade of C.

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


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