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FMX vs. MNST: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Beverages - Soft drinks sector have probably already heard of Fomento Economico (FMX) and Monster Beverage (MNST). 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.

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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, Fomento Economico is sporting a Zacks Rank of #2 (Buy), while Monster Beverage has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FMX is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

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.

FMX currently has a forward P/E ratio of 20.99, while MNST has a forward P/E of 33.21. We also note that FMX has a PEG ratio of 1.42. 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. MNST currently has a PEG ratio of 2.12.

Another notable valuation metric for FMX is its P/B ratio of 1.62. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, MNST has a P/B of 6.86.

These metrics, and several others, help FMX earn a Value grade of A, while MNST has been given a Value grade of D.

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


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Fomento Economico Mexicano S.A.B. de C.V. (FMX) : Free Stock Analysis Report
 
Monster Beverage Corporation (MNST) : Free Stock Analysis Report
 
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