Investors interested in stocks from the Gaming sector have probably already heard of International Game Technology (IGT) and Wynn Resorts (WYNN). 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
International Game Technology and Wynn Resorts are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that IGT likely has seen a stronger improvement to its earnings outlook than WYNN has recently. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
IGT currently has a forward P/E ratio of 10.48, while WYNN has a forward P/E of 18.21. We also note that IGT has a PEG ratio of 1.05. 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. WYNN currently has a PEG ratio of 1.82.
Another notable valuation metric for IGT is its P/B ratio of 1.03. 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, WYNN has a P/B of 6.18.
These are just a few of the metrics contributing to IGT's Value grade of A and WYNN's Value grade of D.
IGT has seen stronger estimate revision activity and sports more attractive valuation metrics than WYNN, so it seems like value investors will conclude that IGT is the superior option right now.
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International Game Technology (IGT) : Free Stock Analysis Report
Wynn Resorts, Limited (WYNN) : Free Stock Analysis Report
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