SVNLY or HSNGY: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Banks - Foreign sector have probably already heard of Svenska Handelsbanken Ab Publ (SVNLY) and Hang Seng Bank Ltd. (HSNGY). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Currently, Svenska Handelsbanken Ab Publ has a Zacks Rank of #2 (Buy), while Hang Seng Bank Ltd. has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SVNLY has an improving earnings outlook. But this is only part of the picture for value investors.
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 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.
SVNLY currently has a forward P/E ratio of 8.23, while HSNGY has a forward P/E of 11.23. We also note that SVNLY has a PEG ratio of 1.41. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HSNGY currently has a PEG ratio of 4.56.
Another notable valuation metric for SVNLY is its P/B ratio of 1.08. 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, HSNGY has a P/B of 1.19.
These metrics, and several others, help SVNLY earn a Value grade of B, while HSNGY has been given a Value grade of F.
SVNLY stands above HSNGY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SVNLY is the superior value option right now.
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Svenska Handelsbanken Ab Publ (SVNLY) : Free Stock Analysis Report
Hang Seng Bank Ltd. (HSNGY) : Free Stock Analysis Report