U.S. Markets open in 7 hrs
  • S&P Futures

    3,601.50
    +25.50 (+0.71%)
     
  • Dow Futures

    29,780.00
    +234.00 (+0.79%)
     
  • Nasdaq Futures

    11,971.75
    +66.50 (+0.56%)
     
  • Russell 2000 Futures

    1,837.50
    +20.40 (+1.12%)
     
  • Crude Oil

    43.58
    +0.52 (+1.21%)
     
  • Gold

    1,829.40
    -8.40 (-0.46%)
     
  • Silver

    23.51
    -0.12 (-0.52%)
     
  • EUR/USD

    1.1858
    +0.0013 (+0.1067%)
     
  • 10-Yr Bond

    0.8570
    0.0000 (0.00%)
     
  • Vix

    22.66
    -1.04 (-4.39%)
     
  • GBP/USD

    1.3341
    +0.0019 (+0.1401%)
     
  • USD/JPY

    104.4490
    -0.0390 (-0.0373%)
     
  • BTC-USD

    18,409.00
    +76.49 (+0.42%)
     
  • CMC Crypto 200

    369.16
    +7.73 (+2.14%)
     
  • FTSE 100

    6,333.84
    -17.61 (-0.28%)
     
  • Nikkei 225

    26,165.59
    +638.22 (+2.50%)
     

AMG or BX: Which Is the Better Value Stock Right Now?

Zacks Equity Research

Investors looking for stocks in the Financial - Investment Management sector might want to consider either Affiliated Managers Group (AMG) or Blackstone Group (BX). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Currently, both Affiliated Managers Group and Blackstone Group are holding a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle 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 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.

AMG currently has a forward P/E ratio of 6.14, while BX has a forward P/E of 24.52. We also note that AMG has a PEG ratio of 0.61. 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. BX currently has a PEG ratio of 1.47.

Another notable valuation metric for AMG is its P/B ratio of 1.15. 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, BX has a P/B of 2.55.

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

Both AMG and BX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AMG is the superior value option right now.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report
 
Blackstone Group Inc/The (BX) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.