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INGR vs. DANOY: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Food - Miscellaneous sector have probably already heard of Ingredion (INGR - Free Report) and Danone (DANOY - 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Ingredion has a Zacks Rank of #2 (Buy), while Danone has a Zacks Rank of #4 (Sell) right now. This means that INGR'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 try to analyze a wide range of traditional figures and metrics to help determine whether 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.

INGR currently has a forward P/E ratio of 13.42, while DANOY has a forward P/E of 19.42. We also note that INGR has a PEG ratio of 1.22. 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. DANOY currently has a PEG ratio of 7.53.

Another notable valuation metric for INGR is its P/B ratio of 2.38. 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, DANOY has a P/B of 2.75.

Based on these metrics and many more, INGR holds a Value grade of A, while DANOY has a Value grade of C.

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


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