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PAGS or EFX: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Financial Transaction Services sector have probably already heard of PagSeguro Digital Ltd. (PAGS - Free Report) and Equifax (EFX - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, PagSeguro Digital Ltd. has a Zacks Rank of #2 (Buy), while Equifax has a Zacks Rank of #4 (Sell). This means that PAGS's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

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 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.

PAGS currently has a forward P/E ratio of 8.70, while EFX has a forward P/E of 28.53. We also note that PAGS has a PEG ratio of 0.88. 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. EFX currently has a PEG ratio of 1.99.

Another notable valuation metric for PAGS is its P/B ratio of 1.18. 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, EFX has a P/B of 5.77.

Based on these metrics and many more, PAGS holds a Value grade of A, while EFX has a Value grade of D.

PAGS sticks out from EFX in both our Zacks Rank and Style Scores models, so value investors will likely feel that PAGS is the better option right now.


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