Back to top

Image: Bigstock

B vs. ATLKY: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors interested in Manufacturing - General Industrial stocks are likely familiar with Barnes Group (B - Free Report) and Atlas Copco AB (ATLKY - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Barnes Group has a Zacks Rank of #2 (Buy), while Atlas Copco AB has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that B is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.

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.

B currently has a forward P/E ratio of 18.90, while ATLKY has a forward P/E of 25.78. We also note that B has a PEG ratio of 1.89. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ATLKY currently has a PEG ratio of 3.87.

Another notable valuation metric for B is its P/B ratio of 1.52. 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, ATLKY has a P/B of 7.65.

These are just a few of the metrics contributing to B's Value grade of B and ATLKY's Value grade of D.

B stands above ATLKY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that B is the superior value option right now.


See More Zacks Research for These Tickers


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


Atlas Copco AB (ATLKY) - free report >>

Barnes Group, Inc. (B) - free report >>

Published in