Investors looking for stocks in the Film and Television Production and Distribution sector might want to consider either Lions Gate Entertainment (LGF.A) or Imax (IMAX). 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Lions Gate Entertainment has a Zacks Rank of #1 (Strong Buy), while Imax has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that LGF.A has an improving earnings outlook. 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 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.
LGF.A currently has a forward P/E ratio of 10.68, while IMAX has a forward P/E of 20.77. We also note that LGF.A has a PEG ratio of 0.71. 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. IMAX currently has a PEG ratio of 1.09.
Another notable valuation metric for LGF.A is its P/B ratio of 1.10. 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, IMAX has a P/B of 2.39.
These metrics, and several others, help LGF.A earn a Value grade of A, while IMAX has been given a Value grade of D.
LGF.A sticks out from IMAX in both our Zacks Rank and Style Scores models, so value investors will likely feel that LGF.A is the better option right now.
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Lions Gate Entertainment Corp. (LGF.A) : Free Stock Analysis Report
IMAX Corporation (IMAX) : Free Stock Analysis Report
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