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AGNC or HASI: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the REIT and Equity Trust sector have probably already heard of AGNC Investment (AGNC - Free Report) and Hannon Armstrong (HASI - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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.

Right now, both AGNC Investment and Hannon Armstrong 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. However, value investors will care about much more than just this.

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.

AGNC currently has a forward P/E ratio of 8.21, while HASI has a forward P/E of 21.18. We also note that AGNC has a PEG ratio of 2.74. 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. HASI currently has a PEG ratio of 7.57.

Another notable valuation metric for AGNC is its P/B ratio of 1. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, HASI has a P/B of 2.17.

These are just a few of the metrics contributing to AGNC's Value grade of B and HASI's Value grade of F.

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


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AGNC Investment Corp. (AGNC) - free report >>

Hannon Armstrong Sustainable Infrastructure Capital, Inc. (HASI) - free report >>

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