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SKFRY vs. ESAB: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Metal Products - Procurement and Fabrication sector might want to consider either AB SKF (SKFRY - Free Report) or Esab (ESAB - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Both AB SKF and Esab have a Zacks Rank of # 1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. 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 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.

SKFRY currently has a forward P/E ratio of 11.76, while ESAB has a forward P/E of 14.99. We also note that SKFRY has a PEG ratio of 0.63. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ESAB currently has a PEG ratio of 3.18.

Another notable valuation metric for SKFRY is its P/B ratio of 1.37. 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, ESAB has a P/B of 2.50.

Based on these metrics and many more, SKFRY holds a Value grade of B, while ESAB has a Value grade of D.

Both SKFRY and ESAB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that SKFRY is the superior value option right now.


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