Back to top

Image: Bigstock

FMC vs. AIQUY: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors looking for stocks in the Chemical - Diversified sector might want to consider either FMC (FMC - Free Report) or Air Liquide (AIQUY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

FMC has a Zacks Rank of #2 (Buy), while Air Liquide 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 FMC has an improving earnings outlook. But this is just one factor that value investors are interested in.

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 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.

FMC currently has a forward P/E ratio of 18.75, while AIQUY has a forward P/E of 27.88. We also note that FMC has a PEG ratio of 1.58. 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. AIQUY currently has a PEG ratio of 2.67.

Another notable valuation metric for FMC is its P/B ratio of 1.74. 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, AIQUY has a P/B of 3.57.

These metrics, and several others, help FMC earn a Value grade of B, while AIQUY has been given a Value grade of D.

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


See More Zacks Research for These Tickers


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


Air Liquide (AIQUY) - free report >>

FMC Corporation (FMC) - free report >>

Published in