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VCTR vs. OAK: Which Stock Is the Better Value Option?

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Investors interested in Financial - Investment Management stocks are likely familiar with Victory Capital Holdings (VCTR - Free Report) and Oaktree Capital Group, LLC . But which of these two companies is the best option for those looking for undervalued stocks? 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 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, Victory Capital Holdings has a Zacks Rank of #1 (Strong Buy), while Oaktree Capital Group, LLC has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that VCTR likely has seen a stronger improvement to its earnings outlook than OAK has recently. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

VCTR currently has a forward P/E ratio of 6.71, while OAK has a forward P/E of 14.74. We also note that VCTR has a PEG ratio of 0.56. 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. OAK currently has a PEG ratio of 0.98.

Another notable valuation metric for VCTR is its P/B ratio of 1.71. 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, OAK has a P/B of 3.26.

These are just a few of the metrics contributing to VCTR's Value grade of A and OAK's Value grade of D.

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


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