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BDORY vs. DNBBY: Which Stock Should Value Investors Buy Now?

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Investors with an interest in Banks - Foreign stocks have likely encountered both Banco Do Brasil SA (BDORY - Free Report) and DNB Bank ASA (DNBBY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, Banco Do Brasil SA is sporting a Zacks Rank of #2 (Buy), while DNB Bank ASA 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 BDORY has an improving earnings outlook. But this is only part of the picture 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 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.

BDORY currently has a forward P/E ratio of 3.83, while DNBBY has a forward P/E of 8.30. We also note that BDORY has a PEG ratio of 0.48. 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. DNBBY currently has a PEG ratio of 1.96.

Another notable valuation metric for BDORY is its P/B ratio of 0.82. 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, DNBBY has a P/B of 1.21.

These are just a few of the metrics contributing to BDORY's Value grade of A and DNBBY's Value grade of C.

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


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