Back to top

Image: Bigstock

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

Read MoreHide Full Article

Investors looking for stocks in the Banks - Foreign sector might want to consider either Woori Bank (WF - Free Report) or National Australia Bank Ltd. (NABZY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. 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 Woori Bank and National Australia Bank Ltd. are sporting a Zacks Rank of #2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.

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.

WF currently has a forward P/E ratio of 6.62, while NABZY has a forward P/E of 16.68. We also note that WF has a PEG ratio of 0.67. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NABZY currently has a PEG ratio of 3.15.

Another notable valuation metric for WF is its P/B ratio of 0.61. 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, NABZY has a P/B of 2.24.

These metrics, and several others, help WF earn a Value grade of A, while NABZY has been given a Value grade of C.

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

Zacks' 7 Best Strong Buy Stocks (New Research Report)

Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.

Click Here, It's Really Free

Published in