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SXI vs. NDSN: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Manufacturing - General Industrial sector might want to consider either Standex International (SXI - Free Report) or Nordson (NDSN - Free Report) . 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, both Standex International and Nordson are sporting 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 piece of the puzzle 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.

SXI currently has a forward P/E ratio of 17.66, while NDSN has a forward P/E of 24.64. We also note that SXI has a PEG ratio of 1.26. 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. NDSN currently has a PEG ratio of 1.90.

Another notable valuation metric for SXI is its P/B ratio of 2.44. 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, NDSN has a P/B of 5.81.

These are just a few of the metrics contributing to SXI's Value grade of B and NDSN's Value grade of D.

Both SXI and NDSN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that SXI is the superior value option right now.


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