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IX vs. SLFPY: Which Stock Is the Better Value Option?

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Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both Orix (IX - Free Report) and Standard Life PLC Unsponsored ADR (SLFPY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.

Currently, Orix has a Zacks Rank of #2 (Buy), while Standard Life PLC Unsponsored ADR has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that IX is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

IX currently has a forward P/E ratio of 7.13, while SLFPY has a forward P/E of 11.93. We also note that IX has a PEG ratio of 1. 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. SLFPY currently has a PEG ratio of 2.09.

Another notable valuation metric for IX is its P/B ratio of 0.80. 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, SLFPY has a P/B of 1.07.

These are just a few of the metrics contributing to IX's Value grade of A and SLFPY's Value grade of C.

IX stands above SLFPY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that IX is the superior value option right now.


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