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BCKIY or SPXSF: Which Is the Better Value Stock Right Now?

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Investors interested in Engineering - R and D Services stocks are likely familiar with Babcock International Group PLC (BCKIY - Free Report) and SPIRAX SARCO (SPXSF - 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.

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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Babcock International Group PLC has a Zacks Rank of #2 (Buy), while SPIRAX SARCO has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BCKIY is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

BCKIY currently has a forward P/E ratio of 8.39, while SPXSF has a forward P/E of 33.08. We also note that BCKIY has a PEG ratio of 2.10. 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. SPXSF currently has a PEG ratio of 4.14.

Another notable valuation metric for BCKIY is its P/B ratio of 1.12. 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, SPXSF has a P/B of 8.64.

These are just a few of the metrics contributing to BCKIY's Value grade of A and SPXSF's Value grade of F.

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


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Spirax-Sarco Engineering (SPXSF) - free report >>

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