Back to top

Image: Bigstock

ZAGG vs. BWXT: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors interested in stocks from the Electronics - Miscellaneous Components sector have probably already heard of Zagg and BWX Technologies (BWXT - 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.

Right now, Zagg is sporting a Zacks Rank of #1 (Strong Buy), while BWX Technologies has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ZAGG likely has seen a stronger improvement to its earnings outlook than BWXT has recently. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.

ZAGG currently has a forward P/E ratio of 6.87, while BWXT has a forward P/E of 17.13. We also note that ZAGG has a PEG ratio of 0.92. 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. BWXT currently has a PEG ratio of 1.61.

Another notable valuation metric for ZAGG is its P/B ratio of 1.97. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, BWXT has a P/B of 10.97.

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

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


See More Zacks Research for These Tickers


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


BWX Technologies, Inc. (BWXT) - free report >>

Published in