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LAZ vs. SEIC: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Financial - Investment Management sector have probably already heard of Lazard Ltd (LAZ - Free Report) and SEI Investments (SEIC - 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.

Lazard Ltd and SEI Investments are both sporting a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. However, value investors will care about much more than just this.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

LAZ currently has a forward P/E ratio of 10.72, while SEIC has a forward P/E of 20. We also note that LAZ has a PEG ratio of 1.02. 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. SEIC currently has a PEG ratio of 1.67.

Another notable valuation metric for LAZ is its P/B ratio of 5.72. 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, SEIC has a P/B of 6.20.

Based on these metrics and many more, LAZ holds a Value grade of A, while SEIC has a Value grade of D.

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


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