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IX vs. BX: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Orix (IX - Free Report) or Blackstone Inc. (BX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.

Orix and Blackstone Inc. 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 IX has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

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.

IX currently has a forward P/E ratio of 7.66, while BX has a forward P/E of 20.60. We also note that IX has a PEG ratio of 0.31. 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. BX currently has a PEG ratio of 1.58.

Another notable valuation metric for IX is its P/B ratio of 0.78. 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, BX has a P/B of 3.56.

Based on these metrics and many more, IX holds a Value grade of A, while BX has a Value grade of C.

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


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