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Investors with an interest in Retail - Supermarkets stocks have likely encountered both Tesco PLC (TSCDY) and WalMart de Mexico SAB de CV (WMMVY). 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.
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.
Tesco PLC and WalMart de Mexico SAB de CV are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TSCDY has an improving earnings outlook. But this is only part of the picture 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.
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.
TSCDY currently has a forward P/E ratio of 12.46, while WMMVY has a forward P/E of 26.53. We also note that TSCDY has a PEG ratio of 0.47. 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. WMMVY currently has a PEG ratio of 3.12.
Another notable valuation metric for TSCDY is its P/B ratio of 1.59. 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, WMMVY has a P/B of 7.09.
These are just a few of the metrics contributing to TSCDY's Value grade of A and WMMVY's Value grade of C.
TSCDY 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 TSCDY is likely the superior value option right now.
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Tesco PLC (TSCDY) : Free Stock Analysis Report
WalMart de Mexico SAB de CV (WMMVY) : Free Stock Analysis Report
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