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SVNLY vs. BSAC: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Banks - Foreign sector might want to consider either Svenska Handelsbanken Ab Publ (SVNLY - Free Report) or Banco Santander-Chile (BSAC - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Svenska Handelsbanken Ab Publ is sporting a Zacks Rank of #2 (Buy), while Banco Santander-Chile has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that SVNLY likely has seen a stronger improvement to its earnings outlook than BSAC has recently. But this is just one factor that value investors are interested in.

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 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.

SVNLY currently has a forward P/E ratio of 8.93, while BSAC has a forward P/E of 10.90. We also note that SVNLY has a PEG ratio of 1.77. 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. BSAC currently has a PEG ratio of 2.48.

Another notable valuation metric for SVNLY is its P/B ratio of 1.09. 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, BSAC has a P/B of 1.50.

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

SVNLY 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 SVNLY is likely the superior value option right now.


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Banco Santander Chile (BSAC) - free report >>

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