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FLS vs. IEX: Which Stock Should Value Investors Buy Now?

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Investors interested in Manufacturing - General Industrial stocks are likely familiar with Flowserve (FLS) and Idex (IEX). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Flowserve and Idex are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that FLS has an improving earnings outlook. But this is only part of the picture for value investors.

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 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.

FLS currently has a forward P/E ratio of 19.27, while IEX has a forward P/E of 34.39. We also note that FLS has a PEG ratio of 2.78. 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. IEX currently has a PEG ratio of 3.44.

Another notable valuation metric for FLS is its P/B ratio of 2.15. 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, IEX has a P/B of 5.50.

These metrics, and several others, help FLS earn a Value grade of A, while IEX has been given a Value grade of C.

FLS sticks out from IEX in both our Zacks Rank and Style Scores models, so value investors will likely feel that FLS is the better option right now.


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Flowserve Corporation (FLS) : Free Stock Analysis Report
 
IDEX Corporation (IEX) : Free Stock Analysis Report
 
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