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KGFHY or TSCO: Which Is the Better Value Stock Right Now?

Zacks Equity Research
·2-min read

Investors with an interest in Retail - Miscellaneous stocks have likely encountered both Kingfisher PLC (KGFHY) and Tractor Supply (TSCO). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Both Kingfisher PLC and Tractor Supply have a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

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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.

KGFHY currently has a forward P/E ratio of 13.61, while TSCO has a forward P/E of 27.11. We also note that KGFHY has a PEG ratio of 2.24. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TSCO currently has a PEG ratio of 3.01.

Another notable valuation metric for KGFHY is its P/B ratio of 1.23. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, TSCO has a P/B of 10.95.

These are just a few of the metrics contributing to KGFHY's Value grade of A and TSCO's Value grade of C.

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


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Kingfisher PLC (KGFHY) : Free Stock Analysis Report
 
Tractor Supply Company (TSCO) : Free Stock Analysis Report
 
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