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PDD vs. MELI: Which Stock Should Value Investors Buy Now?
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Investors interested in Internet - Commerce stocks are likely familiar with PDD Holdings Inc. (PDD - Free Report) and MercadoLibre (MELI - 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.
Right now, PDD Holdings Inc. is sporting a Zacks Rank of #1 (Strong Buy), while MercadoLibre 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 PDD has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
PDD currently has a forward P/E ratio of 16.93, while MELI has a forward P/E of 51.22. We also note that PDD has a PEG ratio of 0.34. 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. MELI currently has a PEG ratio of 1.18.
Another notable valuation metric for PDD is its P/B ratio of 7.48. 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, MELI has a P/B of 26.01.
These metrics, and several others, help PDD earn a Value grade of B, while MELI has been given a Value grade of C.
PDD sticks out from MELI in both our Zacks Rank and Style Scores models, so value investors will likely feel that PDD is the better option right now.
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PDD vs. MELI: Which Stock Should Value Investors Buy Now?
Investors interested in Internet - Commerce stocks are likely familiar with PDD Holdings Inc. (PDD - Free Report) and MercadoLibre (MELI - 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.
Right now, PDD Holdings Inc. is sporting a Zacks Rank of #1 (Strong Buy), while MercadoLibre 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 PDD has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
PDD currently has a forward P/E ratio of 16.93, while MELI has a forward P/E of 51.22. We also note that PDD has a PEG ratio of 0.34. 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. MELI currently has a PEG ratio of 1.18.
Another notable valuation metric for PDD is its P/B ratio of 7.48. 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, MELI has a P/B of 26.01.
These metrics, and several others, help PDD earn a Value grade of B, while MELI has been given a Value grade of C.
PDD sticks out from MELI in both our Zacks Rank and Style Scores models, so value investors will likely feel that PDD is the better option right now.