GRC or IR: Which Is the Better Value Stock Right Now?
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Investors with an interest in Manufacturing - General Industrial stocks have likely encountered both Gorman-Rupp (GRC) and Ingersoll Rand (IR). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Gorman-Rupp is sporting a Zacks Rank of #2 (Buy), while Ingersoll Rand has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that GRC likely has seen a stronger improvement to its earnings outlook than IR has recently. But this is just one piece of the puzzle for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
GRC currently has a forward P/E ratio of 20.53, while IR has a forward P/E of 27.37. We also note that GRC has a PEG ratio of 1.58. 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. IR currently has a PEG ratio of 2.48.
Another notable valuation metric for GRC is its P/B ratio of 2.78. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, IR has a P/B of 3.66.
These are just a few of the metrics contributing to GRC's Value grade of B and IR's Value grade of D.
GRC sticks out from IR in both our Zacks Rank and Style Scores models, so value investors will likely feel that GRC is the better option right now.
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Gorman-Rupp Company (The) (GRC) : Free Stock Analysis Report
Ingersoll Rand Inc. (IR) : Free Stock Analysis Report