Back to top

Image: Bigstock

PCMI or FNKO: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Consumer Products - Discretionary sector might want to consider either PCM or Funko, Inc. (FNKO - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.

PCM and Funko, Inc. are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that PCMI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

PCMI currently has a forward P/E ratio of 8.01, while FNKO has a forward P/E of 17.10. We also note that PCMI has a PEG ratio of 0.40. 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. FNKO currently has a PEG ratio of 0.78.

Another notable valuation metric for PCMI is its P/B ratio of 1.64. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, FNKO has a P/B of 2.78.

These are just a few of the metrics contributing to PCMI's Value grade of B and FNKO's Value grade of C.

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Funko, Inc. (FNKO) - free report >>

Published in