LUNMF vs. SCCO: Which Stock Is the Better Value Option?
Investors with an interest in Mining - Non Ferrous stocks have likely encountered both Lundin Mining (LUNMF) and Southern Copper (SCCO). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
Lundin Mining has a Zacks Rank of #2 (Buy), while Southern Copper has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that LUNMF is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
LUNMF currently has a forward P/E ratio of 12.76, while SCCO has a forward P/E of 20.15. We also note that LUNMF has a PEG ratio of 1.01. 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. SCCO currently has a PEG ratio of 13.09.
Another notable valuation metric for LUNMF is its P/B ratio of 0.96. 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, SCCO has a P/B of 7.02.
These metrics, and several others, help LUNMF earn a Value grade of A, while SCCO has been given a Value grade of D.
LUNMF is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that LUNMF is likely the superior value option right now.
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Lundin Mining Corp. (LUNMF) : Free Stock Analysis Report
Southern Copper Corporation (SCCO) : Free Stock Analysis Report
