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FUL vs. LTHM: Which Stock Should Value Investors Buy Now?

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Investors interested in Chemical - Specialty stocks are likely familiar with H. B. Fuller (FUL) and Livent (LTHM). 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.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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, H. B. Fuller is sporting a Zacks Rank of #2 (Buy), while Livent has a Zacks Rank of #3 (Hold). This means that FUL's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.

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.

FUL currently has a forward P/E ratio of 16.80, while LTHM has a forward P/E of 115.52. We also note that FUL has a PEG ratio of 2.15. 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. LTHM currently has a PEG ratio of 5.38.

Another notable valuation metric for FUL is its P/B ratio of 2.17. 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, LTHM has a P/B of 5.59.

Based on these metrics and many more, FUL holds a Value grade of B, while LTHM has a Value grade of F.

FUL 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 FUL is likely the superior value option right now.


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H. B. Fuller Company (FUL) : Free Stock Analysis Report
 
Livent Corporation (LTHM) : Free Stock Analysis Report
 
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