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GEO or GLPI: Which Is the Better Value Stock Right Now?

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Investors with an interest in REIT and Equity Trust - Other stocks have likely encountered both Geo Group (GEO) and Gaming and Leisure Properties (GLPI). But which of these two companies is the best option for those looking for undervalued stocks? 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.

Right now, Geo Group is sporting a Zacks Rank of #2 (Buy), while Gaming and Leisure Properties has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that GEO is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

GEO currently has a forward P/E ratio of 3.23, while GLPI has a forward P/E of 13.68. We also note that GEO has a PEG ratio of 0.32. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GLPI currently has a PEG ratio of 3.01.

Another notable valuation metric for GEO is its P/B ratio of 0.95. 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, GLPI has a P/B of 4.09.

These metrics, and several others, help GEO earn a Value grade of A, while GLPI has been given a Value grade of C.

GEO stands above GLPI thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GEO is the superior value option right now.

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Geo Group Inc The (GEO) : Free Stock Analysis Report
Gaming and Leisure Properties, Inc. (GLPI) : Free Stock Analysis Report
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