OSIS vs. NJDCY: Which Stock Is the Better Value Option?
Investors looking for stocks in the Electronics - Miscellaneous Components sector might want to consider either OSI Systems (OSIS) or Nidec Corp. (NJDCY). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
OSI Systems has a Zacks Rank of #2 (Buy), while Nidec Corp. has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that OSIS likely has seen a stronger improvement to its earnings outlook than NJDCY has recently. 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.
OSIS currently has a forward P/E ratio of 17.65, while NJDCY has a forward P/E of 76.85. We also note that OSIS has a PEG ratio of 1.96. 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. NJDCY currently has a PEG ratio of 3.64.
Another notable valuation metric for OSIS is its P/B ratio of 2.75. 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, NJDCY has a P/B of 8.29.
Based on these metrics and many more, OSIS holds a Value grade of B, while NJDCY has a Value grade of D.
OSIS has seen stronger estimate revision activity and sports more attractive valuation metrics than NJDCY, so it seems like value investors will conclude that OSIS is the superior option right now.
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OSI Systems, Inc. (OSIS) : Free Stock Analysis Report
Nidec Corp. (NJDCY) : Free Stock Analysis Report
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