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AZZ or ABBNY: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Manufacturing - Electronics sector might want to consider either AZZ (AZZ - Free Report) or ABB (ABBNY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Currently, AZZ has a Zacks Rank of #1 (Strong Buy), while ABB has a Zacks Rank of #2 (Buy). This means that AZZ's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

AZZ currently has a forward P/E ratio of 15.75, while ABBNY has a forward P/E of 26.31. We also note that AZZ has a PEG ratio of 1.12. 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. ABBNY currently has a PEG ratio of 3.11.

Another notable valuation metric for AZZ is its P/B ratio of 2.80. 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, ABBNY has a P/B of 7.84.

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

AZZ 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 AZZ is likely the superior value option right now.


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