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SWDBY vs. DBSDY: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Banks - Foreign sector have probably already heard of Swedbank AB (SWDBY - Free Report) and DBS Group Holdings Ltd (DBSDY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, both Swedbank AB and DBS Group Holdings Ltd 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. But this is only part of the picture for value investors.

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 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.

SWDBY currently has a forward P/E ratio of 6.33, while DBSDY has a forward P/E of 8.26. We also note that SWDBY has a PEG ratio of 0.50. 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. DBSDY currently has a PEG ratio of 1.69.

Another notable valuation metric for SWDBY is its P/B ratio of 1.20. 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, DBSDY has a P/B of 1.50.

These are just a few of the metrics contributing to SWDBY's Value grade of B and DBSDY's Value grade of C.

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


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