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PEBO vs. FIBK: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Banks - Midwest sector might want to consider either Peoples Bancorp (PEBO - Free Report) or First Interstate BancSystem (FIBK - 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.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.

Peoples Bancorp and First Interstate BancSystem are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PEBO is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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.

PEBO currently has a forward P/E ratio of 13.11, while FIBK has a forward P/E of 14.94. We also note that PEBO has a PEG ratio of 1.64. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. FIBK currently has a PEG ratio of 1.66.

Another notable valuation metric for PEBO is its P/B ratio of 1.34. 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, FIBK has a P/B of 1.58.

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

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


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First Interstate BancSystem, Inc. (FIBK) - free report >>

Peoples Bancorp Inc. (PEBO) - free report >>

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