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BOCH vs. PUB: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Banks - West sector might want to consider either Bank of Commerce or Peoples Utah Bancorp . 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.

Both Bank of Commerce and Peoples Utah Bancorp have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is only part of the picture for value investors.

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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

BOCH currently has a forward P/E ratio of 14.94, while PUB has a forward P/E of 18.58. We also note that BOCH has a PEG ratio of 2.13. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. PUB currently has a PEG ratio of 2.32.

Another notable valuation metric for BOCH is its P/B ratio of 1.52. 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, PUB has a P/B of 2.70.

Based on these metrics and many more, BOCH holds a Value grade of B, while PUB has a Value grade of C.

Both BOCH and PUB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BOCH is the superior value option right now.