B vs. NDSN: Which Stock Should Value Investors Buy Now?
Investors with an interest in Manufacturing - General Industrial stocks have likely encountered both Barnes Group (B) 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.
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.
Right now, Barnes Group is sporting a Zacks Rank of #2 (Buy), while Nordson has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that B has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
B currently has a forward P/E ratio of 14.84, while NDSN has a forward P/E of 24.04. We also note that B has a PEG ratio of 1.48. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NDSN currently has a PEG ratio of 1.85.
Another notable valuation metric for B is its P/B ratio of 1.20. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, NDSN has a P/B of 4.76.
Based on these metrics and many more, B holds a Value grade of B, while NDSN has a Value grade of D.
B is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that B is likely the superior value option right now.
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Barnes Group, Inc. (B) : Free Stock Analysis Report
Nordson Corporation (NDSN) : Free Stock Analysis Report
