FLEX vs. TRMB: Which Stock Is the Better Value Option?
Investors with an interest in Electronics - Miscellaneous Products stocks have likely encountered both Flex (FLEX) and Trimble Navigation (TRMB). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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.
Both Flex and Trimble Navigation have a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
FLEX currently has a forward P/E ratio of 9.02, while TRMB has a forward P/E of 20.13. We also note that FLEX has a PEG ratio of 0.77. 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. TRMB currently has a PEG ratio of 1.92.
Another notable valuation metric for FLEX is its P/B ratio of 1.92. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, TRMB has a P/B of 3.87.
Based on these metrics and many more, FLEX holds a Value grade of A, while TRMB has a Value grade of D.
Both FLEX and TRMB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that FLEX is the superior value option right now.
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Flex Ltd. (FLEX) : Free Stock Analysis Report
Trimble Inc. (TRMB) : Free Stock Analysis Report
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