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RIO vs. WPM: Which Stock Is the Better Value Option?
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Investors with an interest in Mining - Miscellaneous stocks have likely encountered both Rio Tinto (RIO - Free Report) and Wheaton Precious Metals Corp. (WPM - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.
Right now, Rio Tinto is sporting a Zacks Rank of #1 (Strong Buy), while Wheaton Precious Metals Corp. has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that RIO has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
RIO currently has a forward P/E ratio of 12.04, while WPM has a forward P/E of 37.78. We also note that RIO has a PEG ratio of 0.96. 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. WPM currently has a PEG ratio of 1.32.
Another notable valuation metric for RIO is its P/B ratio of 1.72. 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, WPM has a P/B of 7.04.
These metrics, and several others, help RIO earn a Value grade of B, while WPM has been given a Value grade of F.
RIO stands above WPM thanks to its solid earnings outlook, and based on these valuation figures, we also feel that RIO is the superior value option right now.
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RIO vs. WPM: Which Stock Is the Better Value Option?
Investors with an interest in Mining - Miscellaneous stocks have likely encountered both Rio Tinto (RIO - Free Report) and Wheaton Precious Metals Corp. (WPM - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.
Right now, Rio Tinto is sporting a Zacks Rank of #1 (Strong Buy), while Wheaton Precious Metals Corp. has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that RIO has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
RIO currently has a forward P/E ratio of 12.04, while WPM has a forward P/E of 37.78. We also note that RIO has a PEG ratio of 0.96. 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. WPM currently has a PEG ratio of 1.32.
Another notable valuation metric for RIO is its P/B ratio of 1.72. 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, WPM has a P/B of 7.04.
These metrics, and several others, help RIO earn a Value grade of B, while WPM has been given a Value grade of F.
RIO stands above WPM thanks to its solid earnings outlook, and based on these valuation figures, we also feel that RIO is the superior value option right now.