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FIS vs. DLO: Which Stock Is the Better Value Option?

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Investors with an interest in Financial Transaction Services stocks have likely encountered both Fidelity National Information Services (FIS - Free Report) and DLocal (DLO - 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.

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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Currently, Fidelity National Information Services has a Zacks Rank of #2 (Buy), while DLocal has a Zacks Rank of #4 (Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FIS is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

FIS currently has a forward P/E ratio of 9.41, while DLO has a forward P/E of 25.17. We also note that FIS has a PEG ratio of 0.90. 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. DLO currently has a PEG ratio of 0.95.

Another notable valuation metric for FIS is its P/B ratio of 1.20. 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, DLO has a P/B of 10.01.

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

FIS 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 FIS is likely the superior value option right now.


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Fidelity National Information Services, Inc. (FIS) - free report >>

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