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KR vs. WMT: Which Stock Should Value Investors Buy Now?
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Investors interested in stocks from the Retail - Supermarkets sector have probably already heard of Kroger (KR - Free Report) and Walmart (WMT - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, both Kroger and Walmart 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 only part of the picture for value investors.
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.
KR currently has a forward P/E ratio of 14.11, while WMT has a forward P/E of 25.11. We also note that KR has a PEG ratio of 1.67. 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. WMT currently has a PEG ratio of 4.56.
Another notable valuation metric for KR is its P/B ratio of 3.56. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, WMT has a P/B of 5.02.
Based on these metrics and many more, KR holds a Value grade of A, while WMT has a Value grade of C.
Both KR and WMT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that KR is the superior value option right now.
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KR vs. WMT: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Retail - Supermarkets sector have probably already heard of Kroger (KR - Free Report) and Walmart (WMT - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, both Kroger and Walmart 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 only part of the picture for value investors.
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.
KR currently has a forward P/E ratio of 14.11, while WMT has a forward P/E of 25.11. We also note that KR has a PEG ratio of 1.67. 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. WMT currently has a PEG ratio of 4.56.
Another notable valuation metric for KR is its P/B ratio of 3.56. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, WMT has a P/B of 5.02.
Based on these metrics and many more, KR holds a Value grade of A, while WMT has a Value grade of C.
Both KR and WMT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that KR is the superior value option right now.