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GEO or EGP: Which Is the Better Value Stock Right Now?

Investors interested in REIT and Equity Trust - Other stocks are likely familiar with Geo Group (GEO) and EastGroup Properties (EGP). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Geo Group has a Zacks Rank of #2 (Buy), while EastGroup Properties has a Zacks Rank of #3 (Hold). This means that GEO's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

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 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.

GEO currently has a forward P/E ratio of 4.92, while EGP has a forward P/E of 22.32. We also note that GEO has a PEG ratio of 0.49. 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. EGP currently has a PEG ratio of 2.95.

Another notable valuation metric for GEO is its P/B ratio of 1.36. 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, EGP has a P/B of 3.39.

These are just a few of the metrics contributing to GEO's Value grade of A and EGP's Value grade of D.

GEO sticks out from EGP in both our Zacks Rank and Style Scores models, so value investors will likely feel that GEO is the better option right now.

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Geo Group Inc The (GEO) : Free Stock Analysis Report

EastGroup Properties, Inc. (EGP) : Free Stock Analysis Report

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Zacks Investment Research