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DXPE vs. B: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Manufacturing - General Industrial sector might want to consider either DXP Enterprises (DXPE - Free Report) or Barnes Group (B - 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.

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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

DXP Enterprises has a Zacks Rank of #2 (Buy), while Barnes Group has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that DXPE is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

DXPE currently has a forward P/E ratio of 15.16, while B has a forward P/E of 17.16. We also note that DXPE has a PEG ratio of 0.87. 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. B currently has a PEG ratio of 2.45.

Another notable valuation metric for DXPE is its P/B ratio of 1.99. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, B has a P/B of 2.33.

Based on these metrics and many more, DXPE holds a Value grade of B, while B has a Value grade of C.

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


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