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BRG vs. MAA: Which Stock Is the Better Value Option?

Zacks Equity Research
Signature Bank (SBNY) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

Investors with an interest in REIT and Equity Trust - Residential stocks have likely encountered both Bluerock (BRG) and Mid-America Apartment Communities (MAA). 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.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Bluerock and Mid-America Apartment Communities are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. Investors should feel comfortable knowing that BRG likely has seen a stronger improvement to its earnings outlook than MAA has recently. But this is just one factor that value investors are interested in.

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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

BRG currently has a forward P/E ratio of 13.28, while MAA has a forward P/E of 16.55. We also note that BRG has a PEG ratio of 1.33. 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. MAA currently has a PEG ratio of 3.15.

Another notable valuation metric for BRG is its P/B ratio of 1.48. 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, MAA has a P/B of 1.83.

These are just a few of the metrics contributing to BRG's Value grade of B and MAA's Value grade of F.

BRG stands above MAA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BRG is the superior value option right now.


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