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LXFR or NDSN: Which Is the Better Value Stock Right Now?

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Investors with an interest in Manufacturing - General Industrial stocks have likely encountered both Luxfer (LXFR) and Nordson (NDSN). 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Both Luxfer and Nordson have 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 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

LXFR currently has a forward P/E ratio of 11.76, while NDSN has a forward P/E of 23.71. We also note that LXFR has a PEG ratio of 0.90. 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. NDSN currently has a PEG ratio of 1.82.

Another notable valuation metric for LXFR is its P/B ratio of 2.31. 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, NDSN has a P/B of 5.81.

Based on these metrics and many more, LXFR holds a Value grade of B, while NDSN has a Value grade of D.

Both LXFR and NDSN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that LXFR is the superior value option right now.


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Luxfer Holdings PLC (LXFR) : Free Stock Analysis Report
 
Nordson Corporation (NDSN) : Free Stock Analysis Report
 
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Zacks Investment Research