Back to top

Image: Bigstock

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

Read MoreHide Full Article

Investors interested in stocks from the Financial - Miscellaneous Services sector have probably already heard of Intercorp Financial Services Inc. (IFS - Free Report) and Blackstone Inc. (BX - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Intercorp Financial Services Inc. and Blackstone Inc. are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that IFS likely has seen a stronger improvement to its earnings outlook than BX has recently. But this is only part of the picture for value investors.

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.

IFS currently has a forward P/E ratio of 9.12, while BX has a forward P/E of 22.74. We also note that IFS has a PEG ratio of 0.73. 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. BX currently has a PEG ratio of 1.53.

Another notable valuation metric for IFS is its P/B ratio of 1.64. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BX has a P/B of 4.8.

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

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

Published in