Yahoo Finance SMGZY or RKT: Which Is the Better Value Stock Right Now?
Investors with an interest in Technology Services stocks have likely encountered both Smiths Group PLC (SMGZY) and Rocket Companies (RKT). 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.
Smiths Group PLC and Rocket Companies are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that SMGZY'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 analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
SMGZY currently has a forward P/E ratio of 15.73, while RKT has a forward P/E of 44.67. We also note that SMGZY has a PEG ratio of 1.73. 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. RKT currently has a PEG ratio of 8.93.
Another notable valuation metric for SMGZY 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, RKT has a P/B of 3.48.
These are just a few of the metrics contributing to SMGZY's Value grade of B and RKT's Value grade of D.
SMGZY sticks out from RKT in both our Zacks Rank and Style Scores models, so value investors will likely feel that SMGZY is the better option right now.
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Smiths Group PLC (SMGZY) : Free Stock Analysis Report
Rocket Companies, Inc. (RKT) : Free Stock Analysis Report
