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TAP or DEO: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Beverages - Alcohol sector might want to consider either Molson Coors Brewing (TAP - Free Report) or Diageo (DEO - 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Molson Coors Brewing has a Zacks Rank of #2 (Buy), while Diageo has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TAP is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
TAP currently has a forward P/E ratio of 9.03, while DEO has a forward P/E of 23.37. We also note that TAP has a PEG ratio of 2.42. 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. DEO currently has a PEG ratio of 3.09.
Another notable valuation metric for TAP is its P/B ratio of 0.59. 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, DEO has a P/B of 7.87.
Based on these metrics and many more, TAP holds a Value grade of A, while DEO has a Value grade of C.
TAP stands above DEO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TAP is the superior value option right now.
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TAP or DEO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Beverages - Alcohol sector might want to consider either Molson Coors Brewing (TAP - Free Report) or Diageo (DEO - 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Molson Coors Brewing has a Zacks Rank of #2 (Buy), while Diageo has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TAP is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
TAP currently has a forward P/E ratio of 9.03, while DEO has a forward P/E of 23.37. We also note that TAP has a PEG ratio of 2.42. 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. DEO currently has a PEG ratio of 3.09.
Another notable valuation metric for TAP is its P/B ratio of 0.59. 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, DEO has a P/B of 7.87.
Based on these metrics and many more, TAP holds a Value grade of A, while DEO has a Value grade of C.
TAP stands above DEO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TAP is the superior value option right now.