Back to top

Image: Bigstock

KRYAY vs. MDLZ: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors interested in stocks from the Food - Miscellaneous sector have probably already heard of Kerry Group PLC (KRYAY - Free Report) and Mondelez (MDLZ - 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 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.

Currently, Kerry Group PLC has a Zacks Rank of #2 (Buy), while Mondelez has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that KRYAY is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.

KRYAY currently has a forward P/E ratio of 20.31, while MDLZ has a forward P/E of 20.43. We also note that KRYAY has a PEG ratio of 2.21. 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. MDLZ currently has a PEG ratio of 2.89.

Another notable valuation metric for KRYAY is its P/B ratio of 2.48. 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, MDLZ has a P/B of 3.44.

Based on these metrics and many more, KRYAY holds a Value grade of B, while MDLZ has a Value grade of C.

KRYAY 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 KRYAY is likely the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Mondelez International, Inc. (MDLZ) - free report >>

Kerry Group PLC (KRYAY) - free report >>

Published in