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LYG vs. WBK: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Banks - Foreign sector might want to consider either Lloyds (LYG - Free Report) or Westpac Banking Corporation . 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Lloyds and Westpac Banking Corporation are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that LYG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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.
LYG currently has a forward P/E ratio of 6.26, while WBK has a forward P/E of 14.61. We also note that LYG has a PEG ratio of 0.20. 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. WBK currently has a PEG ratio of 0.63.
Another notable valuation metric for LYG is its P/B ratio of 0.65. 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, WBK has a P/B of 1.27.
These metrics, and several others, help LYG earn a Value grade of B, while WBK has been given a Value grade of C.
LYG has seen stronger estimate revision activity and sports more attractive valuation metrics than WBK, so it seems like value investors will conclude that LYG is the superior option right now.
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LYG vs. WBK: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Banks - Foreign sector might want to consider either Lloyds (LYG - Free Report) or Westpac Banking Corporation . 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Lloyds and Westpac Banking Corporation are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that LYG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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.
LYG currently has a forward P/E ratio of 6.26, while WBK has a forward P/E of 14.61. We also note that LYG has a PEG ratio of 0.20. 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. WBK currently has a PEG ratio of 0.63.
Another notable valuation metric for LYG is its P/B ratio of 0.65. 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, WBK has a P/B of 1.27.
These metrics, and several others, help LYG earn a Value grade of B, while WBK has been given a Value grade of C.
LYG has seen stronger estimate revision activity and sports more attractive valuation metrics than WBK, so it seems like value investors will conclude that LYG is the superior option right now.