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BBSEY vs. MCO: Which Stock Should Value Investors Buy Now?

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Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both BB Seguridade Participacoes SA (BBSEY - Free Report) and Moody's (MCO - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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, both BB Seguridade Participacoes SA and Moody's are holding a Zacks Rank of #2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings 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.

BBSEY currently has a forward P/E ratio of 7.80, while MCO has a forward P/E of 33.81. We also note that BBSEY has a PEG ratio of 2.20. 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. MCO currently has a PEG ratio of 2.80.

Another notable valuation metric for BBSEY is its P/B ratio of 5.61. 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, MCO has a P/B of 21.35.

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

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


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Moody's Corporation (MCO) - free report >>

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