Back to top

Image: Bigstock

KHC or MHGVY: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Food - Miscellaneous sector might want to consider either Kraft Heinz (KHC - Free Report) or Marine Harvest ASA (MHGVY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Kraft Heinz has a Zacks Rank of #2 (Buy), while Marine Harvest ASA has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that KHC likely has seen a stronger improvement to its earnings outlook than MHGVY has recently. 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.

KHC currently has a forward P/E ratio of 11.37, while MHGVY has a forward P/E of 14.17. We also note that KHC has a PEG ratio of 2.45. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MHGVY currently has a PEG ratio of 5.39.

Another notable valuation metric for KHC is its P/B ratio of 0.83. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MHGVY has a P/B of 2.37.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Kraft Heinz Company (KHC) - free report >>

Marine Harvest ASA (MHGVY) - free report >>

Published in