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IMKTA vs. WMT: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Retail - Supermarkets sector have probably already heard of Ingles (IMKTA - Free Report) and Walmart (WMT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, both Ingles and Walmart are sporting a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one factor that value investors are interested in.

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.

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.

IMKTA currently has a forward P/E ratio of 9.29, while WMT has a forward P/E of 22.99. We also note that IMKTA has a PEG ratio of 1.16. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. WMT currently has a PEG ratio of 4.86.

Another notable valuation metric for IMKTA is its P/B ratio of 1.02. 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, WMT has a P/B of 4.23.

These metrics, and several others, help IMKTA earn a Value grade of A, while WMT has been given a Value grade of C.

Both IMKTA and WMT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that IMKTA is the superior value option right now.


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