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AXP or MCO: Which Is the Better Value Stock Right Now?
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Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both American Express (AXP - Free Report) and Moody's (MCO - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, both American Express and Moody's are sporting 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 just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
AXP currently has a forward P/E ratio of 20.48, while MCO has a forward P/E of 41.10. We also note that AXP has a PEG ratio of 1.49. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. MCO currently has a PEG ratio of 3.09.
Another notable valuation metric for AXP is its P/B ratio of 6.48. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, MCO has a P/B of 21.78.
These metrics, and several others, help AXP earn a Value grade of B, while MCO has been given a Value grade of F.
Both AXP and MCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AXP is the superior value option right now.
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AXP or MCO: Which Is the Better Value Stock Right Now?
Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both American Express (AXP - Free Report) and Moody's (MCO - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, both American Express and Moody's are sporting 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 just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
AXP currently has a forward P/E ratio of 20.48, while MCO has a forward P/E of 41.10. We also note that AXP has a PEG ratio of 1.49. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. MCO currently has a PEG ratio of 3.09.
Another notable valuation metric for AXP is its P/B ratio of 6.48. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, MCO has a P/B of 21.78.
These metrics, and several others, help AXP earn a Value grade of B, while MCO has been given a Value grade of F.
Both AXP and MCO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AXP is the superior value option right now.