GFI vs. FNV: Which Stock Is the Better Value Option?
Investors looking for stocks in the Mining - Gold sector might want to consider either Gold Fields (GFI) or Franco-Nevada (FNV). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Gold Fields has a Zacks Rank of #2 (Buy), while Franco-Nevada has a Zacks Rank of #3 (Hold) right now. This means that GFI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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.
GFI currently has a forward P/E ratio of 13.65, while FNV has a forward P/E of 38.68. We also note that GFI has a PEG ratio of 1.61. 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. FNV currently has a PEG ratio of 9.67.
Another notable valuation metric for GFI is its P/B ratio of 2.93. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, FNV has a P/B of 4.07.
Based on these metrics and many more, GFI holds a Value grade of B, while FNV has a Value grade of F.
GFI sticks out from FNV in both our Zacks Rank and Style Scores models, so value investors will likely feel that GFI is the better option right now.
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Gold Fields Limited (GFI) : Free Stock Analysis Report
Franco-Nevada Corporation (FNV) : Free Stock Analysis Report
