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IBP vs. JHX: Which Stock Is the Better Value Option?
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Investors with an interest in Building Products - Miscellaneous stocks have likely encountered both Installed Building Products (IBP - Free Report) and James Hardie (JHX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, both Installed Building Products and James Hardie 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 only part of the picture for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.
IBP currently has a forward P/E ratio of 16.63, while JHX has a forward P/E of 23.30. We also note that IBP has a PEG ratio of 1.83. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. JHX currently has a PEG ratio of 2.15.
Another notable valuation metric for IBP is its P/B ratio of 8.15. 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, JHX has a P/B of 9.02.
These metrics, and several others, help IBP earn a Value grade of B, while JHX has been given a Value grade of C.
Both IBP and JHX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that IBP is the superior value option right now.
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IBP vs. JHX: Which Stock Is the Better Value Option?
Investors with an interest in Building Products - Miscellaneous stocks have likely encountered both Installed Building Products (IBP - Free Report) and James Hardie (JHX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, both Installed Building Products and James Hardie 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 only part of the picture for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.
IBP currently has a forward P/E ratio of 16.63, while JHX has a forward P/E of 23.30. We also note that IBP has a PEG ratio of 1.83. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. JHX currently has a PEG ratio of 2.15.
Another notable valuation metric for IBP is its P/B ratio of 8.15. 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, JHX has a P/B of 9.02.
These metrics, and several others, help IBP earn a Value grade of B, while JHX has been given a Value grade of C.
Both IBP and JHX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that IBP is the superior value option right now.