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FNB vs. WSBC: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Banks - Southeast sector have probably already heard of F.N.B. (FNB - Free Report) and WesBanco (WSBC - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

F.N.B. and WesBanco are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that FNB has an improving earnings 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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

FNB currently has a forward P/E ratio of 9.70, while WSBC has a forward P/E of 11.17. We also note that FNB 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. WSBC currently has a PEG ratio of 1.12.

Another notable valuation metric for FNB is its P/B ratio of 0.81. 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, WSBC has a P/B of 0.98.

Based on these metrics and many more, FNB holds a Value grade of A, while WSBC has a Value grade of C.

FNB is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that FNB is likely the superior value option right now.


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F.N.B. Corporation (FNB) - free report >>

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