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ASBFY or KRYAY: Which Is the Better Value Stock Right Now?

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Investors with an interest in Food - Miscellaneous stocks have likely encountered both Associated British Foods PLC (ASBFY - Free Report) and Kerry Group PLC (KRYAY - 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.

Associated British Foods PLC has a Zacks Rank of #2 (Buy), while Kerry Group PLC has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ASBFY has an improving earnings outlook. 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.

ASBFY currently has a forward P/E ratio of 13.23, while KRYAY has a forward P/E of 17.85. We also note that ASBFY has a PEG ratio of 1.37. 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. KRYAY currently has a PEG ratio of 2.

Another notable valuation metric for ASBFY is its P/B ratio of 1.67. 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, KRYAY has a P/B of 2.20.

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

ASBFY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ASBFY is likely the superior value option right now.


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