Yahoo Finance LXFR or NDSN: Which Is the Better Value Stock Right Now?
Investors interested in Manufacturing - General Industrial stocks are likely familiar with Luxfer (LXFR) and Nordson (NDSN). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Luxfer is sporting a Zacks Rank of #2 (Buy), while Nordson has a Zacks Rank of #4 (Sell). This means that LXFR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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.
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.
LXFR currently has a forward P/E ratio of 13.98, while NDSN has a forward P/E of 26.83. We also note that LXFR has a PEG ratio of 2. 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. NDSN currently has a PEG ratio of 2.06.
Another notable valuation metric for LXFR is its P/B ratio of 1.53. 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, NDSN has a P/B of 5.75.
Based on these metrics and many more, LXFR holds a Value grade of B, while NDSN has a Value grade of D.
LXFR sticks out from NDSN in both our Zacks Rank and Style Scores models, so value investors will likely feel that LXFR is the better option right now.
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Luxfer Holdings PLC (LXFR) : Free Stock Analysis Report
Nordson Corporation (NDSN) : Free Stock Analysis Report
