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BCS vs. CM: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Banks - Foreign sector might want to consider either Barclays (BCS - Free Report) or Canadian Imperial Bank (CM - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Barclays is sporting a Zacks Rank of #2 (Buy), while Canadian Imperial Bank has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BCS likely has seen a stronger improvement to its earnings outlook than CM has recently. But this is only part of the picture 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.
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.
BCS currently has a forward P/E ratio of 9.17, while CM has a forward P/E of 15.36. We also note that BCS has a PEG ratio of 0.47. 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. CM currently has a PEG ratio of 1.22.
Another notable valuation metric for BCS is its P/B ratio of 0.86. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CM has a P/B of 2.44.
These are just a few of the metrics contributing to BCS's Value grade of B and CM's Value grade of D.
BCS has seen stronger estimate revision activity and sports more attractive valuation metrics than CM, so it seems like value investors will conclude that BCS is the superior option right now.
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BCS vs. CM: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Banks - Foreign sector might want to consider either Barclays (BCS - Free Report) or Canadian Imperial Bank (CM - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Barclays is sporting a Zacks Rank of #2 (Buy), while Canadian Imperial Bank has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BCS likely has seen a stronger improvement to its earnings outlook than CM has recently. But this is only part of the picture 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.
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.
BCS currently has a forward P/E ratio of 9.17, while CM has a forward P/E of 15.36. We also note that BCS has a PEG ratio of 0.47. 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. CM currently has a PEG ratio of 1.22.
Another notable valuation metric for BCS is its P/B ratio of 0.86. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CM has a P/B of 2.44.
These are just a few of the metrics contributing to BCS's Value grade of B and CM's Value grade of D.
BCS has seen stronger estimate revision activity and sports more attractive valuation metrics than CM, so it seems like value investors will conclude that BCS is the superior option right now.