GBOOY or MCO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Grupo Financiero Banorte SAB de CV (GBOOY) or Moody's (MCO). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Grupo Financiero Banorte SAB de CV is sporting a Zacks Rank of #2 (Buy), while Moody's has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that GBOOY likely has seen a stronger improvement to its earnings outlook than MCO has recently. But this is only part of the picture for value investors.
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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
GBOOY currently has a forward P/E ratio of 8.63, while MCO has a forward P/E of 31.83. We also note that GBOOY has a PEG ratio of 0.72. 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. MCO currently has a PEG ratio of 2.89.
Another notable valuation metric for GBOOY is its P/B ratio of 2.13. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, MCO has a P/B of 18.67.
Based on these metrics and many more, GBOOY holds a Value grade of B, while MCO has a Value grade of F.
GBOOY has seen stronger estimate revision activity and sports more attractive valuation metrics than MCO, so it seems like value investors will conclude that GBOOY is the superior 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
Grupo Financiero Banorte SAB de CV (GBOOY) : Free Stock Analysis Report
Moody's Corporation (MCO) : Free Stock Analysis Report
