GMRE or LAMR: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Global Medical REIT (GMRE) and Lamar Advertising (LAMR). 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Global Medical REIT and Lamar Advertising are both sporting a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings 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 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.
GMRE currently has a forward P/E ratio of 10.28, while LAMR has a forward P/E of 13.21. We also note that GMRE has a PEG ratio of 1.14. 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. LAMR currently has a PEG ratio of 4.40.
Another notable valuation metric for GMRE is its P/B ratio of 1.01. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, LAMR has a P/B of 6.75.
These are just a few of the metrics contributing to GMRE's Value grade of B and LAMR's Value grade of D.
Both GMRE and LAMR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that GMRE is the superior value option right now.
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Global Medical REIT Inc. (GMRE) : Free Stock Analysis Report
Lamar Advertising Company (LAMR) : Free Stock Analysis Report
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