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LGF.A vs. FOX: Which Stock Is the Better Value Option?

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Investors interested in Film and Television Production and Distribution stocks are likely familiar with Lions Gate Entertainment (LGF.A - Free Report) and Twenty-First Century Fox (FOX - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Lions Gate Entertainment has a Zacks Rank of #2 (Buy), while Twenty-First Century Fox has a Zacks Rank of #3 (Hold) right now. This means that LGF.A's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

LGF.A currently has a forward P/E ratio of 16.79, while FOX has a forward P/E of 25.99. We also note that LGF.A has a PEG ratio of 1.53. 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. FOX currently has a PEG ratio of 2.89.

Another notable valuation metric for LGF.A is its P/B ratio of 1.28. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, FOX has a P/B of 4.08.

Based on these metrics and many more, LGF.A holds a Value grade of A, while FOX has a Value grade of F.

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


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