CNTY or CHDN: Which Is the Better Value Stock Right Now?
Investors interested in Gaming stocks are likely familiar with Century Casinos (CNTY) and Churchill Downs (CHDN). 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Century Casinos and Churchill Downs are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CNTY has an improving earnings outlook. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
CNTY currently has a forward P/E ratio of 24.68, while CHDN has a forward P/E of 26.02. We also note that CNTY has a PEG ratio of 0.99. 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. CHDN currently has a PEG ratio of 1.30.
Another notable valuation metric for CNTY is its P/B ratio of 1.42. 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, CHDN has a P/B of 10.07.
These metrics, and several others, help CNTY earn a Value grade of B, while CHDN has been given a Value grade of C.
CNTY has seen stronger estimate revision activity and sports more attractive valuation metrics than CHDN, so it seems like value investors will conclude that CNTY is the superior option right now.
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Century Casinos, Inc. (CNTY) : Free Stock Analysis Report
Churchill Downs, Incorporated (CHDN) : Free Stock Analysis Report
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