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ORKLY vs. UTX: Which Stock Is the Better Value Option?

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Investors with an interest in Diversified Operations stocks have likely encountered both Orkla Asa (ORKLY - Free Report) and United Technologies . But which of these two stocks presents investors with the better value opportunity right now? 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Orkla Asa has a Zacks Rank of #2 (Buy), while United Technologies has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ORKLY has an improving earnings 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.

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.

ORKLY currently has a forward P/E ratio of 2.49, while UTX has a forward P/E of 18.27. We also note that ORKLY has a PEG ratio of 0.73. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. UTX currently has a PEG ratio of 2.08.

Another notable valuation metric for ORKLY is its P/B ratio of 2.48. 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, UTX has a P/B of 3.

These metrics, and several others, help ORKLY earn a Value grade of B, while UTX has been given a Value grade of C.

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


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