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GHG vs. CHH: Which Stock Is the Better Value Option?
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Investors interested in Hotels and Motels stocks are likely familiar with GreenTree Hospitality Group Ltd. Sponsored ADR (GHG - Free Report) and Choice Hotels (CHH - 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Right now, GreenTree Hospitality Group Ltd. Sponsored ADR is sporting a Zacks Rank of #2 (Buy), while Choice Hotels has a Zacks Rank of #3 (Hold). This means that GHG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
GHG currently has a forward P/E ratio of 9.35, while CHH has a forward P/E of 21.42. We also note that GHG has a PEG ratio of 0.36. 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. CHH currently has a PEG ratio of 1.84.
Another notable valuation metric for GHG is its P/B ratio of 1.70. 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, CHH has a P/B of 24.50.
Based on these metrics and many more, GHG holds a Value grade of B, while CHH has a Value grade of C.
GHG stands above CHH thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GHG is the superior value option right now.
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GHG vs. CHH: Which Stock Is the Better Value Option?
Investors interested in Hotels and Motels stocks are likely familiar with GreenTree Hospitality Group Ltd. Sponsored ADR (GHG - Free Report) and Choice Hotels (CHH - 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Right now, GreenTree Hospitality Group Ltd. Sponsored ADR is sporting a Zacks Rank of #2 (Buy), while Choice Hotels has a Zacks Rank of #3 (Hold). This means that GHG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
GHG currently has a forward P/E ratio of 9.35, while CHH has a forward P/E of 21.42. We also note that GHG has a PEG ratio of 0.36. 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. CHH currently has a PEG ratio of 1.84.
Another notable valuation metric for GHG is its P/B ratio of 1.70. 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, CHH has a P/B of 24.50.
Based on these metrics and many more, GHG holds a Value grade of B, while CHH has a Value grade of C.
GHG stands above CHH thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GHG is the superior value option right now.