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IX vs. BX: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Orix (IX - Free Report) or Blackstone Inc. (BX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, Orix is sporting a Zacks Rank of #2 (Buy), while Blackstone Inc. 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 IX has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

IX currently has a forward P/E ratio of 11.53, while BX has a forward P/E of 18.14. We also note that IX has a PEG ratio of 0.73. 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. BX currently has a PEG ratio of 0.91.

Another notable valuation metric for IX is its P/B ratio of 1.1. 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, BX has a P/B of 4.14.

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

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

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