BSRR or CVBF: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Banks - West sector have probably already heard of Sierra Bancorp (BSRR) and CVB Financial (CVBF). 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.
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.
Sierra Bancorp has a Zacks Rank of #2 (Buy), while CVB Financial has a Zacks Rank of #3 (Hold) right now. This means that BSRR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.
BSRR currently has a forward P/E ratio of 11.40, while CVBF has a forward P/E of 14.24. We also note that BSRR has a PEG ratio of 1.42. 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. CVBF currently has a PEG ratio of 1.50.
Another notable valuation metric for BSRR is its P/B ratio of 1.38. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CVBF has a P/B of 1.56.
These are just a few of the metrics contributing to BSRR's Value grade of A and CVBF's Value grade of C.
BSRR has seen stronger estimate revision activity and sports more attractive valuation metrics than CVBF, so it seems like value investors will conclude that BSRR is the superior option right now.
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Sierra Bancorp (BSRR) : Free Stock Analysis Report
CVB Financial Corporation (CVBF) : Free Stock Analysis Report
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