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PNFP vs. CHCO: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Banks - Southeast sector might want to consider either Pinnacle Financial (PNFP - Free Report) or City Holding (CHCO - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Pinnacle Financial and City Holding are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that PNFP likely has seen a stronger improvement to its earnings outlook than CHCO has recently. But this is just one piece of the puzzle for value investors.

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.

PNFP currently has a forward P/E ratio of 9.60, while CHCO has a forward P/E of 13.64. We also note that PNFP has a PEG ratio of 0.69. 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. CHCO currently has a PEG ratio of 1.71.

Another notable valuation metric for PNFP is its P/B ratio of 0.94. 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, CHCO has a P/B of 1.89.

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

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


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Pinnacle Financial Partners, Inc. (PNFP) - free report >>

City Holding Company (CHCO) - free report >>

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