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TOL or NVR: Which Is the Better Value Stock Right Now?
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Investors with an interest in Building Products - Home Builders stocks have likely encountered both Toll Brothers (TOL - Free Report) and NVR (NVR - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Toll Brothers has a Zacks Rank of #2 (Buy), while NVR has a Zacks Rank of #3 (Hold). This means that TOL's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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 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.
TOL currently has a forward P/E ratio of 10.69, while NVR has a forward P/E of 19.51. We also note that TOL has a PEG ratio of 1.16. 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. NVR currently has a PEG ratio of 2.57.
Another notable valuation metric for TOL is its P/B ratio of 2.11. 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, NVR has a P/B of 7.40.
These metrics, and several others, help TOL earn a Value grade of B, while NVR has been given a Value grade of D.
TOL has seen stronger estimate revision activity and sports more attractive valuation metrics than NVR, so it seems like value investors will conclude that TOL is the superior option right now.
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TOL or NVR: Which Is the Better Value Stock Right Now?
Investors with an interest in Building Products - Home Builders stocks have likely encountered both Toll Brothers (TOL - Free Report) and NVR (NVR - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Toll Brothers has a Zacks Rank of #2 (Buy), while NVR has a Zacks Rank of #3 (Hold). This means that TOL's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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 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.
TOL currently has a forward P/E ratio of 10.69, while NVR has a forward P/E of 19.51. We also note that TOL has a PEG ratio of 1.16. 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. NVR currently has a PEG ratio of 2.57.
Another notable valuation metric for TOL is its P/B ratio of 2.11. 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, NVR has a P/B of 7.40.
These metrics, and several others, help TOL earn a Value grade of B, while NVR has been given a Value grade of D.
TOL has seen stronger estimate revision activity and sports more attractive valuation metrics than NVR, so it seems like value investors will conclude that TOL is the superior option right now.