Back to top

Image: Bigstock

CFX or GTLS: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Manufacturing - General Industrial sector might want to consider either Colfax or Chart Industries (GTLS - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Colfax has a Zacks Rank of #1 (Strong Buy), while Chart Industries has a Zacks Rank of #2 (Buy). This means that CFX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.

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.

CFX currently has a forward P/E ratio of 16.03, while GTLS has a forward P/E of 38.68. We also note that CFX has a PEG ratio of 1.26. 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. GTLS currently has a PEG ratio of 1.34.

Another notable valuation metric for CFX is its P/B ratio of 1.21. 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, GTLS has a P/B of 2.96.

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

CFX stands above GTLS thanks to its solid earnings outlook, and based on these valuation figures, we also feel that CFX is the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Chart Industries, Inc. (GTLS) - free report >>