BRC vs. ALLE: Which Stock Should Value Investors Buy Now?
BRC vs. ALLE: Which Stock Is the Better Value Option?
Investors with an interest in Security and Safety Services stocks have likely encountered both Brady (BRC) and Allegion (ALLE). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Brady is sporting a Zacks Rank of #2 (Buy), while Allegion has a Zacks Rank of #3 (Hold). This means that BRC's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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 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 17.26, while ALLE has a forward P/E of 26.63. We also note that BRC has a PEG ratio of 2.47. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ALLE currently has a PEG ratio of 3.84.
Another notable valuation metric for BRC is its P/B ratio of 2.92. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, ALLE has a P/B of 16.40.
These are just a few of the metrics contributing to BRC's Value grade of B and ALLE's Value grade of C.
BRC stands above ALLE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BRC is the superior value option right now.
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Brady Corporation (BRC): Free Stock Analysis Report
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