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ABEV or DEO: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Beverages - Alcohol sector might want to consider either Ambev (ABEV - Free Report) or Diageo (DEO - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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, Ambev has a Zacks Rank of #2 (Buy), while Diageo has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ABEV has an improving earnings outlook. 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.
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.
ABEV currently has a forward P/E ratio of 16.79, while DEO has a forward P/E of 19.82. We also note that ABEV has a PEG ratio of 2.39. 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. DEO currently has a PEG ratio of 2.92.
Another notable valuation metric for ABEV is its P/B ratio of 2.50. 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, DEO has a P/B of 9.
These metrics, and several others, help ABEV earn a Value grade of B, while DEO has been given a Value grade of C.
ABEV sticks out from DEO in both our Zacks Rank and Style Scores models, so value investors will likely feel that ABEV is the better option right now.
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ABEV or DEO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Beverages - Alcohol sector might want to consider either Ambev (ABEV - Free Report) or Diageo (DEO - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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, Ambev has a Zacks Rank of #2 (Buy), while Diageo has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ABEV has an improving earnings outlook. 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.
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.
ABEV currently has a forward P/E ratio of 16.79, while DEO has a forward P/E of 19.82. We also note that ABEV has a PEG ratio of 2.39. 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. DEO currently has a PEG ratio of 2.92.
Another notable valuation metric for ABEV is its P/B ratio of 2.50. 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, DEO has a P/B of 9.
These metrics, and several others, help ABEV earn a Value grade of B, while DEO has been given a Value grade of C.
ABEV sticks out from DEO in both our Zacks Rank and Style Scores models, so value investors will likely feel that ABEV is the better option right now.