Investors looking for stocks in the Food - Miscellaneous sector might want to consider either Utz Brands (UTZ) or Danone (DANOY). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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.
Currently, both Utz Brands and Danone are holding a Zacks Rank of # 2 (Buy). 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 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.
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.
UTZ currently has a forward P/E ratio of 16.54, while DANOY has a forward P/E of 19.53. We also note that UTZ has a PEG ratio of 1.75. 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. DANOY currently has a PEG ratio of 4.94.
Another notable valuation metric for UTZ is its P/B ratio of 1.43. 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, DANOY has a P/B of 2.69.
These are just a few of the metrics contributing to UTZ's Value grade of B and DANOY's Value grade of C.
Both UTZ and DANOY are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that UTZ is 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
Utz Brands, Inc. (UTZ): Free Stock Analysis Report Danone (DANOY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
