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JMP vs. TW: Which Stock Is the Better Value Option?

Zacks Equity Research
·2 mins read

Investors looking for stocks in the Financial - Investment Bank sector might want to consider either JMP (JMP) or Tradeweb Markets (TW). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Currently, both JMP and Tradeweb Markets are holding a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.

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.

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.

JMP currently has a forward P/E ratio of 8.97, while TW has a forward P/E of 41.96. We also note that JMP has a PEG ratio of 0.90. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TW currently has a PEG ratio of 3.23.

Another notable valuation metric for JMP is its P/B ratio of 0.85. 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, TW has a P/B of 2.40.

These are just a few of the metrics contributing to JMP's Value grade of B and TW's Value grade of F.

Both JMP and TW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that JMP is the superior value option right now.

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JMP Group LLC (JMP) : Free Stock Analysis Report
Tradeweb Markets Inc. (TW) : Free Stock Analysis Report
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