NOMD vs. POST: Which Stock Should Value Investors Buy Now?

Investors interested in Food – Miscellaneous stocks are likely familiar with Nomad Foods (NOMD) and Post Holdings (POST). But which of these two companies is the best option for those looking for undervalued stocks? 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Nomad Foods has a Zacks Rank of #1 (Strong Buy), while Post Holdings has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that NOMD likely has seen a stronger improvement to its earnings outlook than POST has recently. However, value investors will care about much more than just this.

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 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.

NOMD currently has a forward P/E ratio of 11.65, while POST has a forward P/E of 18.28. We also note that NOMD has a PEG ratio of 1.06. 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. POST currently has a PEG ratio of 3.05.

Another notable valuation metric for NOMD is its P/B ratio of 1.33. 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, POST has a P/B of 2.01.

Based on these metrics and many more, NOMD holds a Value grade of B, while POST has a Value grade of D.

NOMD sticks out from POST in both our Zacks Rank and Style Scores models, so value investors will likely feel that NOMD is the better option right now.

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