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NMR vs. TW: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Financial - Investment Bank sector might want to consider either Nomura Holdings (NMR - Free Report) or Tradeweb Markets (TW - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Nomura Holdings and Tradeweb Markets are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that NMR'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 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.

NMR currently has a forward P/E ratio of 5.30, while TW has a forward P/E of 45.43. We also note that NMR has a PEG ratio of 2.49. 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. TW currently has a PEG ratio of 2.96.

Another notable valuation metric for NMR is its P/B ratio of 0.61. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, TW has a P/B of 2.69.

These metrics, and several others, help NMR earn a Value grade of A, while TW has been given a Value grade of F.

NMR stands above TW thanks to its solid earnings outlook, and based on these valuation figures, we also feel that NMR is the superior value option right now.


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Nomura Holdings Inc ADR (NMR) - free report >>

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