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MARUY or HON: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Diversified Operations sector might want to consider either Marubeni Corp. (MARUY - Free Report) or Honeywell International Inc. (HON - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Marubeni Corp. and Honeywell International Inc. are sporting Zacks Ranks of #1 (Strong Buy) and #2 (Buy), respectively, right now. This means that MARUY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle 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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

MARUY currently has a forward P/E ratio of 7.62, while HON has a forward P/E of 20.03. We also note that MARUY has a PEG ratio of 1.14. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. HON currently has a PEG ratio of 2.31.

Another notable valuation metric for MARUY is its P/B ratio of 1.18. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, HON has a P/B of 7.56.

These are just a few of the metrics contributing to MARUY's Value grade of A and HON's Value grade of D.

MARUY 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 MARUY is likely the superior value option right now.


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