Back to top

Image: Bigstock

IVZ or OWL: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors interested in stocks from the Financial - Investment Management sector have probably already heard of Invesco (IVZ - Free Report) and Blue Owl Capital Inc. (OWL - 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.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.

Invesco has a Zacks Rank of #2 (Buy), while Blue Owl Capital Inc. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that IVZ is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.

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.

IVZ currently has a forward P/E ratio of 8.69, while OWL has a forward P/E of 21.89. We also note that IVZ has a PEG ratio of 1.01. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. OWL currently has a PEG ratio of 1.19.

Another notable valuation metric for IVZ is its P/B ratio of 0.60. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, OWL has a P/B of 4.92.

Based on these metrics and many more, IVZ holds a Value grade of A, while OWL has a Value grade of F.

IVZ 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 IVZ is likely the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Invesco Ltd. (IVZ) - free report >>

Blue Owl Capital Inc. (OWL) - free report >>

Published in