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BAP vs. NABZY: Which Stock Is the Better Value Option?

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Investors with an interest in Banks - Foreign stocks have likely encountered both Credicorp (BAP - Free Report) and National Australia Bank Ltd. (NABZY - 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.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.

Credicorp has a Zacks Rank of #2 (Buy), while National Australia Bank Ltd. has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BAP is likely seeing its earnings outlook improve to a greater extent. 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.

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.

BAP currently has a forward P/E ratio of 9.60, while NABZY has a forward P/E of 15.05. We also note that BAP has a PEG ratio of 0.56. 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. NABZY currently has a PEG ratio of 3.87.

Another notable valuation metric for BAP is its P/B ratio of 1.66. 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, NABZY has a P/B of 1.71.

These are just a few of the metrics contributing to BAP's Value grade of B and NABZY's Value grade of F.

BAP is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that BAP is likely the superior value option right now.


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National Australia Bank Ltd. (NABZY) - free report >>

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