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ICL vs. NGVT: Which Stock Is the Better Value Option?

Zacks Equity Research

Investors with an interest in Chemical - Specialty stocks have likely encountered both Israel Chemicals (ICL) and Ingevity Corporation (NGVT). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Israel Chemicals is sporting a Zacks Rank of #1 (Strong Buy), while Ingevity Corporation 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 ICL has an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.

ICL currently has a forward P/E ratio of 12.26, while NGVT has a forward P/E of 20.60. We also note that ICL has a PEG ratio of 1.29. 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. NGVT currently has a PEG ratio of 2.06.

Another notable valuation metric for ICL is its P/B ratio of 1.68. 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, NGVT has a P/B of 10.46.

These are just a few of the metrics contributing to ICL's Value grade of B and NGVT's Value grade of C.

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


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Israel Chemicals Shs (ICL) : Free Stock Analysis Report
 
Ingevity Corporation (NGVT) : Free Stock Analysis Report
 
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