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RF vs. SNV: Which Stock Is the Better Value Option?

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Investors with an interest in Banks - Southeast stocks have likely encountered both Regions Financial (RF - Free Report) and Synovus Financial (SNV - 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.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, both Regions Financial and Synovus Financial are holding a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

RF currently has a forward P/E ratio of 10.38, while SNV has a forward P/E of 12.59. We also note that RF has a PEG ratio of 0.47. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. SNV currently has a PEG ratio of 1.57.

Another notable valuation metric for RF is its P/B ratio of 1.04. 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, SNV has a P/B of 1.21.

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

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


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Regions Financial Corporation (RF) - free report >>

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