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CVCY vs. GBCI: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Banks - West sector have probably already heard of Central Valley Community Bancorp and Glacier Bancorp (GBCI - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 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.

Central Valley Community Bancorp and Glacier Bancorp are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CVCY is likely seeing its earnings outlook improve to a greater extent. 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.

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.

CVCY currently has a forward P/E ratio of 13.82, while GBCI has a forward P/E of 18.73. We also note that CVCY has a PEG ratio of 1.73. 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. GBCI currently has a PEG ratio of 1.87.

Another notable valuation metric for CVCY is its P/B ratio of 1.36. 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, GBCI has a P/B of 2.36.

These metrics, and several others, help CVCY earn a Value grade of B, while GBCI has been given a Value grade of C.

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


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