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KBCSY or CM: Which Is the Better Value Stock Right Now?

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Investors with an interest in Banks - Foreign stocks have likely encountered both KBC Group SA (KBCSY - Free Report) and Canadian Imperial Bank (CM - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

KBC Group SA has a Zacks Rank of #2 (Buy), while Canadian Imperial Bank has a Zacks Rank of #4 (Sell) right now. This means that KBCSY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

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.

KBCSY currently has a forward P/E ratio of 8.04, while CM has a forward P/E of 8.39. We also note that KBCSY has a PEG ratio of 1.66. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CM currently has a PEG ratio of 2.15.

Another notable valuation metric for KBCSY is its P/B ratio of 0.86. 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, CM has a P/B of 1.28.

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

KBCSY 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 KBCSY is likely the superior value option right now.


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