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BRC vs. HLMAF: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Security and Safety Services sector have probably already heard of Brady (BRC - Free Report) and HALMA PLC (HLMAF - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Brady has a Zacks Rank of #2 (Buy), while HALMA PLC has a Zacks Rank of #4 (Sell) right now. This means that BRC'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 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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

BRC currently has a forward P/E ratio of 21.22, while HLMAF has a forward P/E of 36.32. We also note that BRC has a PEG ratio of 2.83. 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. HLMAF currently has a PEG ratio of 3.30.

Another notable valuation metric for BRC is its P/B ratio of 3.26. 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, HLMAF has a P/B of 7.35.

These are just a few of the metrics contributing to BRC's Value grade of B and HLMAF's Value grade of D.

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


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