SON or ATR: Which Is the Better Value Stock Right Now?
Investors with an interest in Containers - Paper and Packaging stocks have likely encountered both Sonoco (SON) and AptarGroup (ATR). But which of these two stocks presents investors with the better value opportunity right now? 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Sonoco has a Zacks Rank of #2 (Buy), while AptarGroup has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that SON likely has seen a stronger improvement to its earnings outlook than ATR has recently. But this is just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.
SON currently has a forward P/E ratio of 12.59, while ATR has a forward P/E of 28.22. We also note that SON has a PEG ratio of 2.52. 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. ATR currently has a PEG ratio of 4.03.
Another notable valuation metric for SON is its P/B ratio of 3.11. 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, ATR has a P/B of 3.81.
These are just a few of the metrics contributing to SON's Value grade of B and ATR's Value grade of C.
SON is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that SON is likely the superior value option right now.
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Sonoco Products Company (SON) : Free Stock Analysis Report
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