Investors interested in Security and Safety Services stocks are likely familiar with Brady (BRC) and Allegion (ALLE). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 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.

Currently, Brady has a Zacks Rank of #2 (Buy), while Allegion has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BRC is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

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.

BRC currently has a forward P/E ratio of 15.28, while ALLE has a forward P/E of 26.12. We also note that BRC has a PEG ratio of 2.18. 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. ALLE currently has a PEG ratio of 3.76.

Another notable valuation metric for BRC is its P/B ratio of 2.69. 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, ALLE has a P/B of 16.08.

These metrics, and several others, help BRC earn a Value grade of B, while ALLE has been given a Value grade of C.

BRC has seen stronger estimate revision activity and sports more attractive valuation metrics than ALLE, so it seems like value investors will conclude that BRC is the superior option right now.

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Brady Corporation (BRC) : Free Stock Analysis Report
 
Allegion PLC (ALLE) : Free Stock Analysis Report
 
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