U.S. markets open in 25 minutes
  • S&P Futures

    3,956.50
    +19.75 (+0.50%)
     
  • Dow Futures

    33,750.00
    +125.00 (+0.37%)
     
  • Nasdaq Futures

    11,566.75
    +57.25 (+0.50%)
     
  • Russell 2000 Futures

    1,818.10
    +10.10 (+0.56%)
     
  • Crude Oil

    74.86
    +2.85 (+3.96%)
     
  • Gold

    1,799.90
    +1.90 (+0.11%)
     
  • Silver

    23.19
    +0.27 (+1.17%)
     
  • EUR/USD

    1.0532
    +0.0018 (+0.17%)
     
  • 10-Yr Bond

    3.4840
    +0.0760 (+2.23%)
     
  • Vix

    22.72
    +0.55 (+2.48%)
     
  • GBP/USD

    1.2220
    +0.0015 (+0.13%)
     
  • USD/JPY

    136.5490
    +0.0250 (+0.02%)
     
  • BTC-USD

    16,857.27
    -7.85 (-0.05%)
     
  • CMC Crypto 200

    396.60
    -5.43 (-1.35%)
     
  • FTSE 100

    7,496.19
    +7.00 (+0.09%)
     
  • Nikkei 225

    27,574.43
    -111.97 (-0.40%)
     

TEL vs. BWXT: Which Stock Is the Better Value Option?

Investors with an interest in Electronics - Miscellaneous Components stocks have likely encountered both TE Connectivity (TEL) and BWX Technologies (BWXT). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, TE Connectivity has a Zacks Rank of #2 (Buy), while BWX Technologies has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TEL has an improving earnings outlook. But this is just one factor that value investors are interested in.

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 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.

TEL currently has a forward P/E ratio of 15.53, while BWXT has a forward P/E of 15.74. We also note that TEL has a PEG ratio of 1.49. 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. BWXT currently has a PEG ratio of 2.41.

Another notable valuation metric for TEL is its P/B ratio of 3.48. 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, BWXT has a P/B of 6.54.

These are just a few of the metrics contributing to TEL's Value grade of B and BWXT's Value grade of C.

TEL 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 TEL is likely the superior value option right now.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
TE Connectivity Ltd. (TEL) : Free Stock Analysis Report
 
BWX Technologies, Inc. (BWXT) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research