HDSN or GWW: Which Is the Better Value Stock Right Now?
Investors interested in Industrial Services stocks are likely familiar with Hudson Technologies (HDSN) and W.W. Grainger (GWW). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Hudson Technologies and W.W. Grainger are both sporting a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is only part of the picture 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 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.
HDSN currently has a forward P/E ratio of 7.20, while GWW has a forward P/E of 20.71. We also note that HDSN has a PEG ratio of 0.24. 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. GWW currently has a PEG ratio of 1.59.
Another notable valuation metric for HDSN is its P/B ratio of 2.25. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, GWW has a P/B of 12.23.
Based on these metrics and many more, HDSN holds a Value grade of A, while GWW has a Value grade of C.
Both HDSN and GWW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HDSN is the superior value option right now.
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Hudson Technologies, Inc. (HDSN) : Free Stock Analysis Report
W.W. Grainger, Inc. (GWW) : Free Stock Analysis Report
