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NMR vs. TW: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Financial - Investment Bank sector have probably already heard of Nomura Holdings (NMR - Free Report) and Tradeweb Markets Inc. (TW - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Nomura Holdings has a Zacks Rank of #2 (Buy), while Tradeweb Markets Inc. has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that NMR has an improving earnings outlook. But this is just one piece of the puzzle 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.

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 5.57, while TW has a forward P/E of 45.78. We also note that NMR has a PEG ratio of 2.62. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TW currently has a PEG ratio of 2.98.

Another notable valuation metric for NMR is its P/B ratio of 0.67. 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, TW has a P/B of 3.02.

Based on these metrics and many more, NMR holds a Value grade of B, while TW has a Value grade of F.

NMR 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 NMR is likely the superior value option right now.


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

Tradeweb Markets Inc. (TW) - free report >>

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