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BRG or ELS: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the REIT and Equity Trust - Residential sector might want to consider either Bluerock or Equity Lifestyle Properties (ELS - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, Bluerock is sporting a Zacks Rank of #2 (Buy), while Equity Lifestyle Properties has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BRG is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

BRG currently has a forward P/E ratio of 14.90, while ELS has a forward P/E of 31.82. We also note that BRG has a PEG ratio of 2.48. 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. ELS currently has a PEG ratio of 6.87.

Another notable valuation metric for BRG is its P/B ratio of 3.60. 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, ELS has a P/B of 10.59.

These metrics, and several others, help BRG earn a Value grade of B, while ELS has been given a Value grade of D.

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


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