Back to top

Image: Bigstock

FBP vs. DBSDY: 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 First BanCorp (FBP - Free Report) or DBS Group Holdings Ltd (DBSDY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

First BanCorp and DBS Group Holdings Ltd are both sporting a Zacks Rank of #2 (Buy) right now. 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 only part of the picture for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

FBP currently has a forward P/E ratio of 10.87, while DBSDY has a forward P/E of 15.59. We also note that FBP has a PEG ratio of 1.47. 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. DBSDY currently has a PEG ratio of 4.21.

Another notable valuation metric for FBP is its P/B ratio of 1.94. 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, DBSDY has a P/B of 2.63.

These metrics, and several others, help FBP earn a Value grade of B, while DBSDY has been given a Value grade of D.

Both FBP and DBSDY are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that FBP 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