Back to top

Image: Bigstock

BY vs. SBNY: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors interested in stocks from the Banks - Northeast sector have probably already heard of Byline Bancorp (BY - Free Report) and Signature Bank (SBNY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Currently, both Byline Bancorp and Signature Bank are holding a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

BY currently has a forward P/E ratio of 11.83, while SBNY has a forward P/E of 18.64. We also note that BY has a PEG ratio of 1.18. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. SBNY currently has a PEG ratio of 1.96.

Another notable valuation metric for BY is its P/B ratio of 1.11. 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, SBNY has a P/B of 1.96.

These metrics, and several others, help BY earn a Value grade of B, while SBNY has been given a Value grade of F.

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


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Byline Bancorp, Inc. (BY) - free report >>

Signature Bank (SBNY) - free report >>

Published in