Advertisement
UK markets closed
  • FTSE 100

    8,317.59
    -21.64 (-0.26%)
     
  • FTSE 250

    20,770.93
    +139.63 (+0.68%)
     
  • AIM

    810.02
    +5.00 (+0.62%)
     
  • GBP/EUR

    1.1742
    +0.0005 (+0.05%)
     
  • GBP/USD

    1.2740
    +0.0001 (+0.01%)
     
  • Bitcoin GBP

    53,767.26
    -657.38 (-1.21%)
     
  • CMC Crypto 200

    1,489.00
    +4.81 (+0.32%)
     
  • S&P 500

    5,304.72
    +36.88 (+0.70%)
     
  • DOW

    39,069.59
    +4.29 (+0.01%)
     
  • CRUDE OIL

    77.90
    +0.18 (+0.23%)
     
  • GOLD FUTURES

    2,341.20
    +6.70 (+0.29%)
     
  • NIKKEI 225

    38,900.02
    +253.91 (+0.66%)
     
  • HANG SENG

    18,851.93
    +242.99 (+1.31%)
     
  • DAX

    18,714.39
    +21.02 (+0.11%)
     
  • CAC 40

    8,099.02
    +4.05 (+0.05%)
     

BCKIY or ALTR: Which Is the Better Value Stock Right Now?

Investors interested in stocks from the Engineering - R and D Services sector have probably already heard of Babcock International Group PLC (BCKIY) and Altair Engineering (ALTR). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, both Babcock International Group PLC and Altair Engineering are holding a Zacks Rank of # 2 (Buy). Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one piece of the puzzle for value investors.

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.

ADVERTISEMENT

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.

BCKIY currently has a forward P/E ratio of 12.38, while ALTR has a forward P/E of 66.33. We also note that BCKIY has a PEG ratio of 0.35. 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. ALTR currently has a PEG ratio of 5.53.

Another notable valuation metric for BCKIY is its P/B ratio of 7.11. 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, ALTR has a P/B of 9.76.

Based on these metrics and many more, BCKIY holds a Value grade of A, while ALTR has a Value grade of F.

Both BCKIY and ALTR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BCKIY is the superior value option right now.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Babcock International Group PLC (BCKIY) : Free Stock Analysis Report

Altair Engineering Inc. (ALTR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research