ASBFY vs. UTZ: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Food - Miscellaneous sector have probably already heard of Associated British Foods PLC (ASBFY) and Utz Brands (UTZ). 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 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.
Associated British Foods PLC and Utz Brands are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that ASBFY likely has seen a stronger improvement to its earnings outlook than UTZ has recently. But this is just one piece of the puzzle for value investors.
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 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.
ASBFY currently has a forward P/E ratio of 15.97, while UTZ has a forward P/E of 29.74. We also note that ASBFY has a PEG ratio of 4.30. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. UTZ currently has a PEG ratio of 7.55.
Another notable valuation metric for ASBFY is its P/B ratio of 1.26. 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, UTZ has a P/B of 1.53.
Based on these metrics and many more, ASBFY holds a Value grade of B, while UTZ has a Value grade of C.
ASBFY stands above UTZ thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ASBFY is the superior value option right now.
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Associated British Foods PLC (ASBFY) : Free Stock Analysis Report
Utz Brands, Inc. (UTZ) : Free Stock Analysis Report
