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JD or CPNG: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Internet - Commerce sector have probably already heard of JD.com, Inc. (JD - Free Report) and Coupang, Inc. (CPNG - Free Report) . 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.

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, JD.com, Inc. is sporting a Zacks Rank of #1 (Strong Buy), while Coupang, Inc. has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that JD likely has seen a stronger improvement to its earnings outlook than CPNG has recently. But this is just one factor that value investors are interested in.

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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

JD currently has a forward P/E ratio of 10.94, while CPNG has a forward P/E of 285.56. We also note that JD has a PEG ratio of 0.62. 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. CPNG currently has a PEG ratio of 282.73.

Another notable valuation metric for JD is its P/B ratio of 1.74. 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, CPNG has a P/B of 11.93.

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

JD stands above CPNG thanks to its solid earnings outlook, and based on these valuation figures, we also feel that JD is the superior value option right now.


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