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EXPE vs. AMZN: Which Stock Should Value Investors Buy Now?
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Investors interested in stocks from the Internet - Commerce sector have probably already heard of Expedia (EXPE - Free Report) and Amazon (AMZN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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.
Right now, Expedia is sporting a Zacks Rank of #2 (Buy), while Amazon has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that EXPE is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
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.
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.
EXPE currently has a forward P/E ratio of 31.66, while AMZN has a forward P/E of 134.33. We also note that EXPE has a PEG ratio of 2.18. 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. AMZN currently has a PEG ratio of 4.45.
Another notable valuation metric for EXPE is its P/B ratio of 3.27. 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, AMZN has a P/B of 26.38.
These metrics, and several others, help EXPE earn a Value grade of B, while AMZN has been given a Value grade of F.
EXPE stands above AMZN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that EXPE is the superior value option right now.
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EXPE vs. AMZN: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Internet - Commerce sector have probably already heard of Expedia (EXPE - Free Report) and Amazon (AMZN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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.
Right now, Expedia is sporting a Zacks Rank of #2 (Buy), while Amazon has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that EXPE is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
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.
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.
EXPE currently has a forward P/E ratio of 31.66, while AMZN has a forward P/E of 134.33. We also note that EXPE has a PEG ratio of 2.18. 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. AMZN currently has a PEG ratio of 4.45.
Another notable valuation metric for EXPE is its P/B ratio of 3.27. 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, AMZN has a P/B of 26.38.
These metrics, and several others, help EXPE earn a Value grade of B, while AMZN has been given a Value grade of F.
EXPE stands above AMZN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that EXPE is the superior value option right now.