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SPB or UNICY: Which Is the Better Value Stock Right Now?

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Investors interested in Consumer Products - Discretionary stocks are likely familiar with Spectrum Brands (SPB - Free Report) and UNICHARM CORP (UNICY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. 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.

Currently, Spectrum Brands has a Zacks Rank of #2 (Buy), while UNICHARM CORP has a Zacks Rank of #3 (Hold). This means that SPB's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

SPB currently has a forward P/E ratio of 19.99, while UNICY has a forward P/E of 32.31. We also note that SPB has a PEG ratio of 3.50. 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. UNICY currently has a PEG ratio of 3.59.

Another notable valuation metric for SPB is its P/B ratio of 1.46. 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, UNICY has a P/B of 4.20.

Based on these metrics and many more, SPB holds a Value grade of B, while UNICY has a Value grade of D.

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


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