CDP vs. GLPI: Which Stock Is the Better Value Option?
Investors interested in REIT and Equity Trust - Other stocks are likely familiar with COPT Defense (CDP) and Gaming and Leisure Properties (GLPI). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
COPT Defense has a Zacks Rank of #2 (Buy), while Gaming and Leisure Properties has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CDP has an improving earnings outlook. 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 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.
CDP currently has a forward P/E ratio of 10.05, while GLPI has a forward P/E of 12.53. We also note that CDP has a PEG ratio of 0.91. 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. GLPI currently has a PEG ratio of 4.
Another notable valuation metric for CDP is its P/B ratio of 1.53. 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, GLPI has a P/B of 2.96.
These metrics, and several others, help CDP earn a Value grade of B, while GLPI has been given a Value grade of D.
CDP stands above GLPI thanks to its solid earnings outlook, and based on these valuation figures, we also feel that CDP 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
COPT Defense Properties (CDP) : Free Stock Analysis Report
Gaming and Leisure Properties, Inc. (GLPI) : Free Stock Analysis Report
