Back to top
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
ICICI Bank Limited (IBN) - free report >>
Mitsubishi UFJ Financial Group, Inc. (MUFG) - free report >>
We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ICICI Bank Limited (IBN) - free report >>
Mitsubishi UFJ Financial Group, Inc. (MUFG) - free report >>
Image: Bigstock
MUFG vs. IBN: Which Stock Is the Better Value Option?
Investors interested in stocks from the Banks - Foreign sector have probably already heard of Mitsubishi UFJ (MUFG - Free Report) and ICICI Bank Limited (IBN - 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.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Mitsubishi UFJ is sporting a Zacks Rank of #2 (Buy), while ICICI Bank Limited 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 MUFG is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
MUFG currently has a forward P/E ratio of 7.74, while IBN has a forward P/E of 25.70. We also note that MUFG has a PEG ratio of 0.81. 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. IBN currently has a PEG ratio of 0.91.
Another notable valuation metric for MUFG is its P/B ratio of 0.43. 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, IBN has a P/B of 3.20.
Based on these metrics and many more, MUFG holds a Value grade of B, while IBN has a Value grade of C.
MUFG has seen stronger estimate revision activity and sports more attractive valuation metrics than IBN, so it seems like value investors will conclude that MUFG is the superior option right now.