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WF vs. BEN: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Financial - Investment Management sector have probably already heard of Woori Bank (WF - Free Report) and Franklin Resources (BEN - 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.

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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Woori Bank has a Zacks Rank of #1 (Strong Buy), while Franklin Resources has a Zacks Rank of #5 (Strong Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that WF has an improving earnings outlook. But this is just one piece of the puzzle 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.

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.

WF currently has a forward P/E ratio of 5.95, while BEN has a forward P/E of 9.85. We also note that WF has a PEG ratio of 0.99. 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. BEN currently has a PEG ratio of 1.60.

Another notable valuation metric for WF is its P/B ratio of 0.50. 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, BEN has a P/B of 1.52.

Based on these metrics and many more, WF holds a Value grade of B, while BEN has a Value grade of C.

WF has seen stronger estimate revision activity and sports more attractive valuation metrics than BEN, so it seems like value investors will conclude that WF is the superior option right now.


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Franklin Resources, Inc. (BEN) - free report >>

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