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FOXA vs. NFLX: Which Stock Should Value Investors Buy Now?

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Investors interested in Broadcast Radio and Television stocks are likely familiar with Fox (FOXA - Free Report) and Netflix (NFLX - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Fox is sporting a Zacks Rank of #2 (Buy), while Netflix has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that FOXA has an improving earnings 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 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.

FOXA currently has a forward P/E ratio of 9.50, while NFLX has a forward P/E of 36.27. We also note that FOXA has a PEG ratio of 0.41. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NFLX currently has a PEG ratio of 1.67.

Another notable valuation metric for FOXA is its P/B ratio of 1.44. 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, NFLX has a P/B of 12.97.

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

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


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