PH or NDSN: Which Is the Better Value Stock Right Now?
Investors interested in Manufacturing - General Industrial stocks are likely familiar with Parker-Hannifin (PH) and Nordson (NDSN). 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Parker-Hannifin and Nordson are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PH has an improving earnings outlook. However, value investors will care about much more than just this.
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 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.
PH currently has a forward P/E ratio of 16.07, while NDSN has a forward P/E of 23.47. We also note that PH has a PEG ratio of 1.36. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NDSN currently has a PEG ratio of 1.81.
Another notable valuation metric for PH is its P/B ratio of 4.50. 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 6.01.
These are just a few of the metrics contributing to PH's Value grade of B and NDSN's Value grade of D.
PH stands above NDSN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PH is the superior value option right now.
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ParkerHannifin Corporation (PH) : Free Stock Analysis Report
Nordson Corporation (NDSN) : Free Stock Analysis Report
