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CNA or BRK.B: Which Is the Better Value Stock Right Now?
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Investors with an interest in Insurance - Property and Casualty stocks have likely encountered both CNA Financial (CNA - Free Report) and Berkshire Hathaway B (BRK.B - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
CNA Financial has a Zacks Rank of #2 (Buy), while Berkshire Hathaway B has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CNA has an improving earnings outlook. 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.
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.
CNA currently has a forward P/E ratio of 10.34, while BRK.B has a forward P/E of 18.89. We also note that CNA has a PEG ratio of 2.07. 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. BRK.B currently has a PEG ratio of 2.70.
Another notable valuation metric for CNA is its P/B ratio of 1.35. 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, BRK.B has a P/B of 1.43.
These metrics, and several others, help CNA earn a Value grade of A, while BRK.B has been given a Value grade of D.
CNA has seen stronger estimate revision activity and sports more attractive valuation metrics than BRK.B, so it seems like value investors will conclude that CNA is the superior option right now.
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CNA or BRK.B: Which Is the Better Value Stock Right Now?
Investors with an interest in Insurance - Property and Casualty stocks have likely encountered both CNA Financial (CNA - Free Report) and Berkshire Hathaway B (BRK.B - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
CNA Financial has a Zacks Rank of #2 (Buy), while Berkshire Hathaway B has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CNA has an improving earnings outlook. 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.
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.
CNA currently has a forward P/E ratio of 10.34, while BRK.B has a forward P/E of 18.89. We also note that CNA has a PEG ratio of 2.07. 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. BRK.B currently has a PEG ratio of 2.70.
Another notable valuation metric for CNA is its P/B ratio of 1.35. 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, BRK.B has a P/B of 1.43.
These metrics, and several others, help CNA earn a Value grade of A, while BRK.B has been given a Value grade of D.
CNA has seen stronger estimate revision activity and sports more attractive valuation metrics than BRK.B, so it seems like value investors will conclude that CNA is the superior option right now.