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NXRT vs. ESS: Which Stock Is the Better Value Option?
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Investors interested in REIT and Equity Trust - Residential stocks are likely familiar with NexPoint Residential Trust Inc. (NXRT - Free Report) and Essex Property Trust (ESS - 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.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, NexPoint Residential Trust Inc. has a Zacks Rank of #2 (Buy), while Essex Property Trust has a Zacks Rank of #3 (Hold). This means that NXRT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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 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.
NXRT currently has a forward P/E ratio of 10.73, while ESS has a forward P/E of 18.08. We also note that NXRT has a PEG ratio of 1.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ESS currently has a PEG ratio of 6.01.
Another notable valuation metric for NXRT is its P/B ratio of 2.34. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ESS has a P/B of 3.23.
These metrics, and several others, help NXRT earn a Value grade of B, while ESS has been given a Value grade of D.
NXRT sticks out from ESS in both our Zacks Rank and Style Scores models, so value investors will likely feel that NXRT is the better option right now.
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NXRT vs. ESS: Which Stock Is the Better Value Option?
Investors interested in REIT and Equity Trust - Residential stocks are likely familiar with NexPoint Residential Trust Inc. (NXRT - Free Report) and Essex Property Trust (ESS - 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.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, NexPoint Residential Trust Inc. has a Zacks Rank of #2 (Buy), while Essex Property Trust has a Zacks Rank of #3 (Hold). This means that NXRT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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 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.
NXRT currently has a forward P/E ratio of 10.73, while ESS has a forward P/E of 18.08. We also note that NXRT has a PEG ratio of 1.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ESS currently has a PEG ratio of 6.01.
Another notable valuation metric for NXRT is its P/B ratio of 2.34. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ESS has a P/B of 3.23.
These metrics, and several others, help NXRT earn a Value grade of B, while ESS has been given a Value grade of D.
NXRT sticks out from ESS in both our Zacks Rank and Style Scores models, so value investors will likely feel that NXRT is the better option right now.