Investors interested in Financial Transaction Services stocks are likely familiar with Cardtronics (CATM) and Fiserv (FISV). 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.
Cardtronics has a Zacks Rank of #1 (Strong Buy), while Fiserv has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that CATM likely has seen a stronger improvement to its earnings outlook than FISV has recently. However, value investors will care about much more than just this.
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 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.
CATM currently has a forward P/E ratio of 15.70, while FISV has a forward P/E of 24.51. We also note that CATM has a PEG ratio of 1.43. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. FISV currently has a PEG ratio of 2.13.
Another notable valuation metric for CATM is its P/B ratio of 2.73. 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, FISV has a P/B of 10.53.
These metrics, and several others, help CATM earn a Value grade of A, while FISV has been given a Value grade of D.
CATM 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 CATM is likely the superior value option right now.
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Cardtronics PLC (CATM) : Free Stock Analysis Report
Fiserv, Inc. (FISV) : Free Stock Analysis Report
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