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CUZ vs. EGP: Which Stock Is the Better Value Option?

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Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Cousins Properties (CUZ - Free Report) and EastGroup Properties (EGP - 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.

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, Cousins Properties is sporting a Zacks Rank of #2 (Buy), while EastGroup Properties 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 CUZ has an improving earnings outlook. However, value investors will care about much more than just this.

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 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.

CUZ currently has a forward P/E ratio of 10.43, while EGP has a forward P/E of 22.39. We also note that CUZ has a PEG ratio of 2.26. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. EGP currently has a PEG ratio of 3.22.

Another notable valuation metric for CUZ is its P/B ratio of 1.12. 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, EGP has a P/B of 3.23.

These are just a few of the metrics contributing to CUZ's Value grade of B and EGP's Value grade of D.

CUZ is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that CUZ is likely the superior value option right now.

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