Investors interested in Electronics - Miscellaneous Products stocks are likely familiar with Hayward Holdings, Inc. (HAYW) and Rockwell Automation (ROK). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.
Hayward Holdings, Inc. and Rockwell Automation are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that HAYW likely has seen a stronger improvement to its earnings outlook than ROK has recently. 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 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.
HAYW currently has a forward P/E ratio of 16.50, while ROK has a forward P/E of 25.23. We also note that HAYW has a PEG ratio of 1.93. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ROK currently has a PEG ratio of 2.92.
Another notable valuation metric for HAYW is its P/B ratio of 1.82. 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, ROK has a P/B of 7.39.
These metrics, and several others, help HAYW earn a Value grade of B, while ROK has been given a Value grade of D.
HAYW 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 HAYW is likely the superior value option right now.
Zacks Names #1 Semiconductor Stock
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With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>Hayward Holdings, Inc. (HAYW) : Free Stock Analysis Report
Rockwell Automation, Inc. (ROK) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
