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MAKSY vs. WMT: Which Stock Is the Better Value Option?

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Investors interested in Retail - Supermarkets stocks are likely familiar with Marks and Spencer Group PLC (MAKSY - Free Report) and Walmart (WMT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.

Marks and Spencer Group PLC and Walmart are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that MAKSY'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 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

MAKSY currently has a forward P/E ratio of 14.37, while WMT has a forward P/E of 43.45. We also note that MAKSY has a PEG ratio of 2.54. 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. WMT currently has a PEG ratio of 5.28.

Another notable valuation metric for MAKSY is its P/B ratio of 2.27. 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, WMT has a P/B of 8.92.

Based on these metrics and many more, MAKSY holds a Value grade of A, while WMT has a Value grade of C.

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


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