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Investors interested in REIT and Equity Trust - Other stocks are likely familiar with CorEnergy (CORR) and HCP (HCP). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
CorEnergy and HCP 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 CORR has an improving earnings outlook. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
CORR currently has a forward P/E ratio of 10.46, while HCP has a forward P/E of 18.19. We also note that CORR has a PEG ratio of 2.09. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HCP currently has a PEG ratio of 6.86.
Another notable valuation metric for CORR is its P/B ratio of 1.46. 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, HCP has a P/B of 2.36.
Based on these metrics and many more, CORR holds a Value grade of B, while HCP has a Value grade of D.
CORR has seen stronger estimate revision activity and sports more attractive valuation metrics than HCP, so it seems like value investors will conclude that CORR is the superior option right now.
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CorEnergy Infrastructure Trust, Inc. (CORR) : Free Stock Analysis Report
HCP, Inc. (HCP) : Free Stock Analysis Report
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