INTC vs. NVDA: Which Stock Is the Better Value Option?
Investors interested in Semiconductor - General stocks are likely familiar with Intel (INTC) and Nvidia (NVDA). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Intel has a Zacks Rank of #1 (Strong Buy), while Nvidia 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 INTC 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 also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.
INTC currently has a forward P/E ratio of 12.90, while NVDA has a forward P/E of 31.30. We also note that INTC has a PEG ratio of 1.53. 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. NVDA currently has a PEG ratio of 3.05.
Another notable valuation metric for INTC is its P/B ratio of 3.47. 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, NVDA has a P/B of 19.52.
Based on these metrics and many more, INTC holds a Value grade of B, while NVDA has a Value grade of F.
INTC has seen stronger estimate revision activity and sports more attractive valuation metrics than NVDA, so it seems like value investors will conclude that INTC is the superior option right now.
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