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ATCO or BLK: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Financial - Investment Management sector have probably already heard of Atlas and BlackRock (BLK - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Atlas and BlackRock are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ATCO has an improving earnings outlook. However, value investors will care about much more than just this.

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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

ATCO currently has a forward P/E ratio of 9.72, while BLK has a forward P/E of 22.79. We also note that ATCO has a PEG ratio of 0.67. 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. BLK currently has a PEG ratio of 2.28.

Another notable valuation metric for ATCO is its P/B ratio of 0.88. 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, BLK has a P/B of 3.73.

These metrics, and several others, help ATCO earn a Value grade of A, while BLK has been given a Value grade of D.

ATCO 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 ATCO is likely the superior value option right now.


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