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CIO vs. EGP: Which Stock Is the Better Value Option?

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Investors looking for stocks in the REIT and Equity Trust - Other sector might want to consider either City Office REIT (CIO - Free Report) or EastGroup Properties (EGP - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

City Office REIT and EastGroup Properties are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CIO 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

CIO currently has a forward P/E ratio of 4.33, while EGP has a forward P/E of 20.29. We also note that CIO has a PEG ratio of 0.72. 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. EGP currently has a PEG ratio of 3.51.

Another notable valuation metric for CIO is its P/B ratio of 0.31. 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, EGP has a P/B of 2.72.

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

CIO sticks out from EGP in both our Zacks Rank and Style Scores models, so value investors will likely feel that CIO is the better option right now.


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EastGroup Properties, Inc. (EGP) - free report >>

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