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

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Investors looking for stocks in the Banks - Foreign sector might want to consider either Deutsche Bank (DB - Free Report) or National Australia Bank Ltd. (NABZY - 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.

Right now, Deutsche Bank is sporting a Zacks Rank of #1 (Strong Buy), while National Australia Bank Ltd. has a Zacks Rank of #2 (Buy). Investors should feel comfortable knowing that DB likely has seen a stronger improvement to its earnings outlook than NABZY has recently. But this is only part of the picture for value investors.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.

DB currently has a forward P/E ratio of 9.37, while NABZY has a forward P/E of 17.06. We also note that DB has a PEG ratio of 0.37. 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. NABZY currently has a PEG ratio of 5.99.

Another notable valuation metric for DB is its P/B ratio of 0.71. 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, NABZY has a P/B of 2.07.

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

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


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Deutsche Bank Aktiengesellschaft (DB) - free report >>

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