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DBSDY vs. TD: Which Stock Should Value Investors Buy Now?

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Investors with an interest in Banks - Foreign stocks have likely encountered both DBS Group Holdings Ltd (DBSDY - Free Report) and Toronto-Dominion Bank (TD - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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, DBS Group Holdings Ltd has a Zacks Rank of #2 (Buy), while Toronto-Dominion Bank has a Zacks Rank of #3 (Hold). This means that DBSDY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

DBSDY currently has a forward P/E ratio of 8.11, while TD has a forward P/E of 9.91. We also note that DBSDY has a PEG ratio of 1.74. 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. TD currently has a PEG ratio of 2.01.

Another notable valuation metric for DBSDY is its P/B ratio of 1.40. 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, TD has a P/B of 1.47.

These are just a few of the metrics contributing to DBSDY's Value grade of B and TD's Value grade of F.

DBSDY 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 DBSDY is likely the superior value option right now.


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Toronto Dominion Bank (The) (TD) - free report >>

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