Back to top

Image: Bigstock

EVR or MC: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors with an interest in Financial - Investment Bank stocks have likely encountered both Evercore (EVR - Free Report) and Moelis (MC - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Evercore has a Zacks Rank of #1 (Strong Buy), while Moelis has a Zacks Rank of #4 (Sell). This means that EVR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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 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.

EVR currently has a forward P/E ratio of 17.63, while MC has a forward P/E of 20.66. We also note that EVR has a PEG ratio of 0.68. 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. MC currently has a PEG ratio of 0.78.

Another notable valuation metric for EVR is its P/B ratio of 6.29. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MC has a P/B of 8.26.

These are just a few of the metrics contributing to EVR's Value grade of B and MC's Value grade of C.

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

Published in