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PFG vs. ALIZY: Which Stock Is the Better Value Option?

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Investors with an interest in Insurance - Multi line stocks have likely encountered both Principal Financial (PFG - Free Report) and Allianz SE (ALIZY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.

Currently, Principal Financial has a Zacks Rank of #2 (Buy), while Allianz SE has a Zacks Rank of #3 (Hold). This means that PFG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

PFG currently has a forward P/E ratio of 11.89, while ALIZY has a forward P/E of 13.57. We also note that PFG has a PEG ratio of 1.03. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ALIZY currently has a PEG ratio of 2.09.

Another notable valuation metric for PFG is its P/B ratio of 2.02. 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, ALIZY has a P/B of 2.38.

These metrics, and several others, help PFG earn a Value grade of B, while ALIZY has been given a Value grade of C.

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

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