Investors interested in stocks from the Instruments - Control sector have probably already heard of Sensata (ST) and Allied Motion Technologies (AMOT). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Sensata and Allied Motion Technologies are both sporting a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.
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.
ST currently has a forward P/E ratio of 14.84, while AMOT has a forward P/E of 28.32. We also note that ST has a PEG ratio of 1.39. 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. AMOT currently has a PEG ratio of 4.05.
Another notable valuation metric for ST is its P/B ratio of 3.80. 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, AMOT has a P/B of 4.80.
These are just a few of the metrics contributing to ST's Value grade of B and AMOT's Value grade of D.
Both ST and AMOT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ST is the superior value option right now.
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Sensata Technologies Holding N.V. (ST) : Free Stock Analysis Report
Allied Motion Technologies, Inc. (AMOT) : Free Stock Analysis Report
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