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DNBBY vs. IBN: Which Stock Is the Better Value Option?

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Investors interested in Banks - Foreign stocks are likely familiar with DNB Bank ASA (DNBBY - Free Report) and ICICI Bank Limited (IBN - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Currently, DNB Bank ASA has a Zacks Rank of #2 (Buy), while ICICI Bank Limited has a Zacks Rank of #3 (Hold). This means that DNBBY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

DNBBY currently has a forward P/E ratio of 8.78, while IBN has a forward P/E of 18.60. We also note that DNBBY has a PEG ratio of 1.61. 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. IBN currently has a PEG ratio of 1.86.

Another notable valuation metric for DNBBY is its P/B ratio of 1.31. 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, IBN has a P/B of 2.99.

These are just a few of the metrics contributing to DNBBY's Value grade of B and IBN's Value grade of F.

DNBBY stands above IBN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that DNBBY is the superior value option right now.


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