ACI vs. KMB: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Consumer Products - Staples sector might want to consider either Albertsons Companies, Inc. (ACI) or Kimberly-Clark (KMB). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Albertsons Companies, Inc. has a Zacks Rank of #2 (Buy), while Kimberly-Clark has a Zacks Rank of #5 (Strong Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ACI is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
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.
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.
ACI currently has a forward P/E ratio of 12.70, while KMB has a forward P/E of 20.53. We also note that ACI has a PEG ratio of 1.06. 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. KMB currently has a PEG ratio of 4.11.
Another notable valuation metric for ACI is its P/B ratio of 7.93. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, KMB has a P/B of 61.41.
These are just a few of the metrics contributing to ACI's Value grade of A and KMB's Value grade of C.
ACI stands above KMB thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ACI is the superior value option right now.
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Albertsons Companies, Inc. (ACI) : Free Stock Analysis Report
KimberlyClark Corporation (KMB) : Free Stock Analysis Report
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