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UNVR vs. AIQUY: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Chemical - Diversified sector might want to consider either Univar or Air Liquide (AIQUY - 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.

Currently, Univar has a Zacks Rank of #2 (Buy), while Air Liquide 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 UNVR has an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

UNVR currently has a forward P/E ratio of 7.66, while AIQUY has a forward P/E of 22.19. We also note that UNVR has a PEG ratio of 0.53. 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. AIQUY currently has a PEG ratio of 1.71.

Another notable valuation metric for UNVR is its P/B ratio of 1.68. 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, AIQUY has a P/B of 2.64.

These metrics, and several others, help UNVR earn a Value grade of A, while AIQUY has been given a Value grade of C.

UNVR sticks out from AIQUY in both our Zacks Rank and Style Scores models, so value investors will likely feel that UNVR is the better option right now.


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