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TROW vs. ARES: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Financial - Investment Management sector might want to consider either T. Rowe Price (TROW - Free Report) or Ares Management (ARES - 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.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
T. Rowe Price has a Zacks Rank of #2 (Buy), while Ares Management has a Zacks Rank of #3 (Hold) right now. This means that TROW'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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TROW currently has a forward P/E ratio of 12.33, while ARES has a forward P/E of 44.15. We also note that TROW has a PEG ratio of 1.67. 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. ARES currently has a PEG ratio of 1.95.
Another notable valuation metric for TROW is its P/B ratio of 2.47. 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, ARES has a P/B of 10.55.
Based on these metrics and many more, TROW holds a Value grade of B, while ARES has a Value grade of D.
TROW stands above ARES thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TROW is the superior value option right now.
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TROW vs. ARES: Which Stock Is the Better Value Option?
Investors looking for stocks in the Financial - Investment Management sector might want to consider either T. Rowe Price (TROW - Free Report) or Ares Management (ARES - 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.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
T. Rowe Price has a Zacks Rank of #2 (Buy), while Ares Management has a Zacks Rank of #3 (Hold) right now. This means that TROW'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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TROW currently has a forward P/E ratio of 12.33, while ARES has a forward P/E of 44.15. We also note that TROW has a PEG ratio of 1.67. 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. ARES currently has a PEG ratio of 1.95.
Another notable valuation metric for TROW is its P/B ratio of 2.47. 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, ARES has a P/B of 10.55.
Based on these metrics and many more, TROW holds a Value grade of B, while ARES has a Value grade of D.
TROW stands above ARES thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TROW is the superior value option right now.