Which stocks should value investors buy now?

Investors interested in agricultural stocks have probably come across Corteva, Inc. (CTVA) and Limoneira (LMNR). But which of these two stocks currently offers value investors the better value for money? We need to take a closer look.

There are many strategies for discovering value stocks, but we have found that combining a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank highlights companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Corteva, Inc. has a Zacks Rank of #2 (Buy), while Limoneira has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive earnings estimate revisions, so investors can be confident that CTVA has an improving earnings outlook. However, value investors will be interested in much more than just this.

Value investors analyze a variety of traditional and proven metrics to find companies that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a number of key metrics, including the popular P/E ratio, as well as P/S, earnings yield, cash flow per share, and a number of other fundamental metrics that value investors have used for years.

CTVA currently has a forward P/E ratio of 24.48, while LMNR has a forward P/E ratio of 257.93. We also note that CTVA has a PEG ratio of 1.73. This metric is used similarly to the well-known P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. LMNR currently has a PEG ratio of 17.20.

Another important valuation metric for CTVA is its P/B ratio of 1.40. Investors use the P/B ratio to compare a stock’s market value to its book value, which is defined as total assets minus total liabilities. For comparison, LMNR has a P/B ratio of 1.51.

These and several other metrics help CTVA earn a B rating, while LMNR earns a D rating.

CTVA currently has an improving earnings outlook, which makes it stand out in our Zacks Rank Model. And based on the valuation metrics mentioned above, we believe CTVA is probably the better value option right now.

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Limoneira Co (LMNR): Free Stock Analysis Report

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