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NMRK vs. KW: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Real Estate - Operations sector might want to consider either Newmark Group (NMRK - Free Report) or Kennedy-Wilson (KW - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Newmark Group and Kennedy-Wilson are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that NMRK is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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.

NMRK currently has a forward P/E ratio of 5.83, while KW has a forward P/E of 14.11. We also note that NMRK has a PEG ratio of 0.58. 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. KW currently has a PEG ratio of 1.06.

Another notable valuation metric for NMRK is its P/B ratio of 1.42. 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, KW has a P/B of 2.09.

Based on these metrics and many more, NMRK holds a Value grade of B, while KW has a Value grade of C.

NMRK 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 NMRK is likely the superior value option right now.


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Kennedy-Wilson Holdings Inc. (KW) - free report >>

Newmark Group, Inc. (NMRK) - free report >>

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