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LXFR vs. NDSN: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Manufacturing - General Industrial sector have probably already heard of Luxfer (LXFR - Free Report) and Nordson (NDSN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Luxfer has a Zacks Rank of #2 (Buy), while Nordson has a Zacks Rank of #3 (Hold) right now. This means that LXFR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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 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.

LXFR currently has a forward P/E ratio of 13.22, while NDSN has a forward P/E of 25.44. We also note that LXFR has a PEG ratio of 1.89. 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. NDSN currently has a PEG ratio of 1.96.

Another notable valuation metric for LXFR is its P/B ratio of 1.23. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, NDSN has a P/B of 5.45.

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

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


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Nordson Corporation (NDSN) - free report >>

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