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MARUY vs. HTHIY: Which Stock Is the Better Value Option?

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Investors interested in Diversified Operations stocks are likely familiar with Marubeni Corp. (MARUY - Free Report) and Hitachi Ltd. (HTHIY - Free Report) . 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Both Marubeni Corp. and Hitachi Ltd. have a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.

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.

MARUY currently has a forward P/E ratio of 8.64, while HTHIY has a forward P/E of 20.88. We also note that MARUY has a PEG ratio of 3.96. 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. HTHIY currently has a PEG ratio of 11.67.

Another notable valuation metric for MARUY is its P/B ratio of 1.16. 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, HTHIY has a P/B of 1.87.

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

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


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