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MFG vs. NABZY: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Banks - Foreign sector have probably already heard of Mizuho (MFG - Free Report) and National Australia Bank Ltd. (NABZY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.

Both Mizuho and National Australia Bank Ltd. have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

MFG currently has a forward P/E ratio of 11.08, while NABZY has a forward P/E of 16.70. We also note that MFG has a PEG ratio of 0.70. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NABZY currently has a PEG ratio of 12.46.

Another notable valuation metric for MFG is its P/B ratio of 1. 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, NABZY has a P/B of 1.86.

These are just a few of the metrics contributing to MFG's Value grade of B and NABZY's Value grade of D.

Both MFG and NABZY are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that MFG is the superior value option right now.


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Mizuho Financial Group, Inc. (MFG) - free report >>

National Australia Bank Ltd. (NABZY) - free report >>

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