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AXP vs. MCO: Which Stock Is the Better Value Option?
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Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both American Express (AXP - Free Report) and Moody's (MCO - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
American Express and Moody's are both sporting a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. However, value investors will care about much more than just this.
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.
AXP currently has a forward P/E ratio of 20.21, while MCO has a forward P/E of 39.02. We also note that AXP has a PEG ratio of 1.47. 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. MCO currently has a PEG ratio of 3.07.
Another notable valuation metric for AXP is its P/B ratio of 6.40. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, MCO has a P/B of 20.80.
These metrics, and several others, help AXP earn a Value grade of B, while MCO has been given a Value grade of F.
Both AXP and MCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AXP is the superior value option right now.
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AXP vs. MCO: Which Stock Is the Better Value Option?
Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both American Express (AXP - Free Report) and Moody's (MCO - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
American Express and Moody's are both sporting a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. However, value investors will care about much more than just this.
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.
AXP currently has a forward P/E ratio of 20.21, while MCO has a forward P/E of 39.02. We also note that AXP has a PEG ratio of 1.47. 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. MCO currently has a PEG ratio of 3.07.
Another notable valuation metric for AXP is its P/B ratio of 6.40. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, MCO has a P/B of 20.80.
These metrics, and several others, help AXP earn a Value grade of B, while MCO has been given a Value grade of F.
Both AXP and MCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AXP is the superior value option right now.