DLAKY or SWRAY: Which Is the Better Value Stock Right Now?

DLAKY SWRAY

Investors interested in Transportation - Airline stocks are likely familiar with Deutsche Lufthansa AG (DLAKY - Free Report) and Swire Pacific (SWRAY - 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Deutsche Lufthansa AG and Swire Pacific are both sporting a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is only part of the picture for value investors.

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.

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.

DLAKY currently has a forward P/E ratio of 7.53, while SWRAY has a forward P/E of 9.67. We also note that DLAKY has a PEG ratio of 0.24. 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. SWRAY currently has a PEG ratio of 0.70.

Another notable valuation metric for DLAKY is its P/B ratio of 0.68. 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, SWRAY has a P/B of 0.72.

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

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

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