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TT vs. AQUA: Which Stock Should Value Investors Buy Now?
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Investors interested in stocks from the Technology Services sector have probably already heard of Trane Technologies (TT - Free Report) and Evoqua Water . 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Trane Technologies has a Zacks Rank of #2 (Buy), while Evoqua Water has a Zacks Rank of #3 (Hold). This means that TT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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 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.
TT currently has a forward P/E ratio of 22.24, while AQUA has a forward P/E of 51.75. We also note that TT has a PEG ratio of 2.27. 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. AQUA currently has a PEG ratio of 3.45.
Another notable valuation metric for TT is its P/B ratio of 6.95. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AQUA has a P/B of 8.13.
These metrics, and several others, help TT earn a Value grade of B, while AQUA has been given a Value grade of C.
TT is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TT is likely the superior value option right now.
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TT vs. AQUA: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Technology Services sector have probably already heard of Trane Technologies (TT - Free Report) and Evoqua Water . 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Trane Technologies has a Zacks Rank of #2 (Buy), while Evoqua Water has a Zacks Rank of #3 (Hold). This means that TT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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 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.
TT currently has a forward P/E ratio of 22.24, while AQUA has a forward P/E of 51.75. We also note that TT has a PEG ratio of 2.27. 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. AQUA currently has a PEG ratio of 3.45.
Another notable valuation metric for TT is its P/B ratio of 6.95. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AQUA has a P/B of 8.13.
These metrics, and several others, help TT earn a Value grade of B, while AQUA has been given a Value grade of C.
TT is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TT is likely the superior value option right now.