Yahoo Finance NEXA vs. WPM: Which Stock Is the Better Value Option?
Investors with an interest in Mining - Miscellaneous stocks have likely encountered both Nexa Resources S.A. (NEXA) and Wheaton Precious Metals Corp. (WPM). But which of these two stocks presents investors with the better value opportunity right now? Let's 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Nexa Resources S.A. has a Zacks Rank of #2 (Buy), while Wheaton Precious Metals Corp. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that NEXA 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.
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.
NEXA currently has a forward P/E ratio of 20, while WPM has a forward P/E of 41.35. We also note that NEXA has a PEG ratio of 0.59. 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. WPM currently has a PEG ratio of 7.20.
Another notable valuation metric for NEXA is its P/B ratio of 0.57. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, WPM has a P/B of 3.33.
Based on these metrics and many more, NEXA holds a Value grade of B, while WPM has a Value grade of F.
NEXA has seen stronger estimate revision activity and sports more attractive valuation metrics than WPM, so it seems like value investors will conclude that NEXA is the superior option right now.
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Nexa Resources S.A. (NEXA) : Free Stock Analysis Report
Wheaton Precious Metals Corp. (WPM) : Free Stock Analysis Report
