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MAKSY vs. WMT: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Retail - Supermarkets sector might want to consider either Marks and Spencer Group PLC (MAKSY - Free Report) or Walmart (WMT - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Marks and Spencer Group PLC has a Zacks Rank of #2 (Buy), while Walmart has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that MAKSY likely has seen a stronger improvement to its earnings outlook than WMT has recently. However, value investors will care about much more than just this.

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.

MAKSY currently has a forward P/E ratio of 12.38, while WMT has a forward P/E of 24.60. We also note that MAKSY has a PEG ratio of 0.52. 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. WMT currently has a PEG ratio of 4.47.

Another notable valuation metric for MAKSY is its P/B ratio of 1.17. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, WMT has a P/B of 4.83.

These metrics, and several others, help MAKSY earn a Value grade of A, while WMT has been given a Value grade of C.

MAKSY 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 MAKSY is likely the superior value option right now.


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