Yahoo Finance KNF vs. JHX: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Building Products - Miscellaneous sector might want to consider either Knife River (KNF) or James Hardie (JHX). 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Knife River and James Hardie are sporting Zacks Ranks of #2 (Buy) and #5 (Strong Sell), respectively, right now. Investors should feel comfortable knowing that KNF likely has seen a stronger improvement to its earnings outlook than JHX has recently. But this is only part of the picture for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.
KNF currently has a forward P/E ratio of 20.30, while JHX has a forward P/E of 21.82. We also note that KNF has a PEG ratio of 2.68. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. JHX currently has a PEG ratio of 2.85.
Another notable valuation metric for KNF is its P/B ratio of 3.32. 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, JHX has a P/B of 7.72.
Based on these metrics and many more, KNF holds a Value grade of B, while JHX has a Value grade of D.
KNF stands above JHX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that KNF is the superior value option right now.
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Knife River Corporation (KNF) : Free Stock Analysis Report
James Hardie Industries PLC. (JHX) : Free Stock Analysis Report
