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HSBC or SVNLY: Which Is the Better Value Stock Right Now?
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Investors interested in Banks - Foreign stocks are likely familiar with HSBC (HSBC - Free Report) and Svenska Handelsbanken Ab Publ (SVNLY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
HSBC and Svenska Handelsbanken Ab Publ are sporting Zacks Ranks of #1 (Strong Buy) and #2 (Buy), respectively, right now. This means that HSBC'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 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.
HSBC currently has a forward P/E ratio of 5.36, while SVNLY has a forward P/E of 6.42. We also note that HSBC has a PEG ratio of 0.24. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. SVNLY currently has a PEG ratio of 1.43.
Another notable valuation metric for HSBC is its P/B ratio of 0.80. 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, SVNLY has a P/B of 0.87.
These metrics, and several others, help HSBC earn a Value grade of B, while SVNLY has been given a Value grade of D.
HSBC 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 HSBC is likely the superior value option right now.
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HSBC or SVNLY: Which Is the Better Value Stock Right Now?
Investors interested in Banks - Foreign stocks are likely familiar with HSBC (HSBC - Free Report) and Svenska Handelsbanken Ab Publ (SVNLY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
HSBC and Svenska Handelsbanken Ab Publ are sporting Zacks Ranks of #1 (Strong Buy) and #2 (Buy), respectively, right now. This means that HSBC'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 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.
HSBC currently has a forward P/E ratio of 5.36, while SVNLY has a forward P/E of 6.42. We also note that HSBC has a PEG ratio of 0.24. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. SVNLY currently has a PEG ratio of 1.43.
Another notable valuation metric for HSBC is its P/B ratio of 0.80. 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, SVNLY has a P/B of 0.87.
These metrics, and several others, help HSBC earn a Value grade of B, while SVNLY has been given a Value grade of D.
HSBC 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 HSBC is likely the superior value option right now.