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SHG or CM: Which Is the Better Value Stock Right Now?
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Investors interested in Banks - Foreign stocks are likely familiar with Shinhan Financial (SHG - Free Report) and Canadian Imperial Bank (CM - 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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, Shinhan Financial has a Zacks Rank of #2 (Buy), while Canadian Imperial Bank has a Zacks Rank of #4 (Sell). This means that SHG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
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.
SHG currently has a forward P/E ratio of 3.93, while CM has a forward P/E of 7.90. We also note that SHG has a PEG ratio of 1.21. 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. CM currently has a PEG ratio of 2.62.
Another notable valuation metric for SHG is its P/B ratio of 0.31. 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, CM has a P/B of 1.04.
These metrics, and several others, help SHG earn a Value grade of A, while CM has been given a Value grade of C.
SHG has seen stronger estimate revision activity and sports more attractive valuation metrics than CM, so it seems like value investors will conclude that SHG is the superior option right now.
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SHG or CM: Which Is the Better Value Stock Right Now?
Investors interested in Banks - Foreign stocks are likely familiar with Shinhan Financial (SHG - Free Report) and Canadian Imperial Bank (CM - 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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, Shinhan Financial has a Zacks Rank of #2 (Buy), while Canadian Imperial Bank has a Zacks Rank of #4 (Sell). This means that SHG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
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.
SHG currently has a forward P/E ratio of 3.93, while CM has a forward P/E of 7.90. We also note that SHG has a PEG ratio of 1.21. 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. CM currently has a PEG ratio of 2.62.
Another notable valuation metric for SHG is its P/B ratio of 0.31. 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, CM has a P/B of 1.04.
These metrics, and several others, help SHG earn a Value grade of A, while CM has been given a Value grade of C.
SHG has seen stronger estimate revision activity and sports more attractive valuation metrics than CM, so it seems like value investors will conclude that SHG is the superior option right now.