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PYPL vs. MA: Which Stock Is the Better Value Option?
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Investors interested in Financial Transaction Services stocks are likely familiar with Paypal (PYPL - Free Report) and MasterCard (MA - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, both Paypal and MasterCard are sporting a Zacks Rank of #2 (Buy). 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 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.
PYPL currently has a forward P/E ratio of 14.50, while MA has a forward P/E of 34.65. We also note that PYPL has a PEG ratio of 1.20. 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. MA currently has a PEG ratio of 2.41.
Another notable valuation metric for PYPL is its P/B ratio of 3.55. 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, MA has a P/B of 75.65.
These are just a few of the metrics contributing to PYPL's Value grade of A and MA's Value grade of D.
Both PYPL and MA are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PYPL is the superior value option right now.
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PYPL vs. MA: Which Stock Is the Better Value Option?
Investors interested in Financial Transaction Services stocks are likely familiar with Paypal (PYPL - Free Report) and MasterCard (MA - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, both Paypal and MasterCard are sporting a Zacks Rank of #2 (Buy). 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 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.
PYPL currently has a forward P/E ratio of 14.50, while MA has a forward P/E of 34.65. We also note that PYPL has a PEG ratio of 1.20. 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. MA currently has a PEG ratio of 2.41.
Another notable valuation metric for PYPL is its P/B ratio of 3.55. 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, MA has a P/B of 75.65.
These are just a few of the metrics contributing to PYPL's Value grade of A and MA's Value grade of D.
Both PYPL and MA are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PYPL is the superior value option right now.