ITRN or ALLE: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Security and Safety Services sector have probably already heard of Ituran (ITRN) and Allegion (ALLE). 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Ituran has a Zacks Rank of #1 (Strong Buy), while Allegion has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ITRN is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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 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.
ITRN currently has a forward P/E ratio of 14.15, while ALLE has a forward P/E of 20.53. We also note that ITRN has a PEG ratio of 1.18. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ALLE currently has a PEG ratio of 1.60.
Another notable valuation metric for ITRN is its P/B ratio of 4.31. 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, ALLE has a P/B of 14.63.
These metrics, and several others, help ITRN earn a Value grade of B, while ALLE has been given a Value grade of C.
ITRN sticks out from ALLE in both our Zacks Rank and Style Scores models, so value investors will likely feel that ITRN is the better option right now.
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Ituran Location and Control Ltd. (ITRN) : Free Stock Analysis Report
Allegion PLC (ALLE) : Free Stock Analysis Report
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