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NXST or NFLX: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Broadcast Radio and Television sector have probably already heard of Nexstar Broadcasting Group (NXST - Free Report) and Netflix (NFLX - 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.

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 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, Nexstar Broadcasting Group is sporting a Zacks Rank of #2 (Buy), while Netflix has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that NXST has an improving earnings outlook. But this is only part of the picture 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.

NXST currently has a forward P/E ratio of 5.90, while NFLX has a forward P/E of 78.28. We also note that NXST has a PEG ratio of 0.59. 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. NFLX currently has a PEG ratio of 2.61.

Another notable valuation metric for NXST is its P/B ratio of 1.74. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, NFLX has a P/B of 20.90.

These metrics, and several others, help NXST earn a Value grade of A, while NFLX has been given a Value grade of F.

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


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