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MARUY vs. HON: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Diversified Operations sector have probably already heard of Marubeni Corp. (MARUY - Free Report) and Honeywell International Inc. (HON - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 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.

Marubeni Corp. has a Zacks Rank of #1 (Strong Buy), while Honeywell International Inc. has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that MARUY likely has seen a stronger improvement to its earnings outlook than HON has recently. But this is just one factor that value investors are interested in.

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.

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.

MARUY currently has a forward P/E ratio of 4.77, while HON has a forward P/E of 22.68. We also note that MARUY has a PEG ratio of 0.56. 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. HON currently has a PEG ratio of 2.53.

Another notable valuation metric for MARUY is its P/B ratio of 1. 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, HON has a P/B of 7.58.

These are just a few of the metrics contributing to MARUY's Value grade of A and HON's Value grade of D.

MARUY has seen stronger estimate revision activity and sports more attractive valuation metrics than HON, so it seems like value investors will conclude that MARUY is the superior option right now.


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