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MARUY vs. ITT: 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 ITT (ITT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Marubeni Corp. has a Zacks Rank of #2 (Buy), while ITT 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 MARUY 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 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

MARUY currently has a forward P/E ratio of 12.31, while ITT has a forward P/E of 24.08. We also note that MARUY has a PEG ratio of 1.62. 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. ITT currently has a PEG ratio of 1.79.

Another notable valuation metric for MARUY is its P/B ratio of 1.62. 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, ITT has a P/B of 3.59.

These metrics, and several others, help MARUY earn a Value grade of B, while ITT has been given a Value grade of D.

MARUY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that MARUY is likely the superior value option right now.

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