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

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Investors interested in Banks - Foreign stocks are likely familiar with Credicorp (BAP - Free Report) and DBS Group Holdings Ltd (DBSDY - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, both Credicorp and DBS Group Holdings Ltd are sporting a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.

BAP currently has a forward P/E ratio of 8.87, while DBSDY has a forward P/E of 10.27. We also note that BAP has a PEG ratio of 0.55. 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. DBSDY currently has a PEG ratio of 8.56.

Another notable valuation metric for BAP is its P/B ratio of 1.44. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, DBSDY has a P/B of 1.71.

These are just a few of the metrics contributing to BAP's Value grade of A and DBSDY's Value grade of D.

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


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