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SSL or FUPBY: Which Is the Better Value Stock Right Now?

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Investors interested in Oil and Gas - Integrated - International stocks are likely familiar with Sasol (SSL - Free Report) and Fuchs Petrolub SE Unsponsored ADR (FUPBY - 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.

Sasol has a Zacks Rank of #2 (Buy), while Fuchs Petrolub SE Unsponsored ADR 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 SSL has an improving earnings outlook. But this is only part of the picture for value investors.

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.

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.

SSL currently has a forward P/E ratio of 2.67, while FUPBY has a forward P/E of 18.81. We also note that SSL has a PEG ratio of 0.26. 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. FUPBY currently has a PEG ratio of 1.65.

Another notable valuation metric for SSL is its P/B ratio of 0.38. 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, FUPBY has a P/B of 3.35.

Based on these metrics and many more, SSL holds a Value grade of A, while FUPBY has a Value grade of D.

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


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