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SVNLY or DNBBY: Which Is the Better Value Stock Right Now?

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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 DNB Bank ASA (DNBBY - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, Svenska Handelsbanken Ab Publ is sporting a Zacks Rank of #2 (Buy), while DNB Bank ASA 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 SVNLY is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.

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.

SVNLY currently has a forward P/E ratio of 7.10, while DNBBY has a forward P/E of 7.92. We also note that SVNLY has a PEG ratio of 1.85. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. DNBBY currently has a PEG ratio of 2.08.

Another notable valuation metric for SVNLY is its P/B ratio of 0.90. 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, DNBBY has a P/B of 1.05.

These are just a few of the metrics contributing to SVNLY's Value grade of B and DNBBY's Value grade of D.

SVNLY stands above DNBBY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SVNLY is the superior value option right now.


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DNB Bank ASA (DNBBY) - free report >>

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