NEXA vs. WPM: Which Stock Is the Better Value Option?
Investors with an interest in Mining - Miscellaneous stocks have likely encountered both Nexa Resources S.A. (NEXA) and Wheaton Precious Metals Corp. (WPM). But which of these two stocks presents investors with the better value opportunity right now? 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Nexa Resources S.A. is sporting a Zacks Rank of #1 (Strong Buy), while Wheaton Precious Metals Corp. has a Zacks Rank of #3 (Hold). This means that NEXA's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
NEXA currently has a forward P/E ratio of 2.07, while WPM has a forward P/E of 25.83. We also note that NEXA has a PEG ratio of 0.38. 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. WPM currently has a PEG ratio of 5.17.
Another notable valuation metric for NEXA is its P/B ratio of 0.44. 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, WPM has a P/B of 2.63.
Based on these metrics and many more, NEXA holds a Value grade of A, while WPM has a Value grade of D.
NEXA has seen stronger estimate revision activity and sports more attractive valuation metrics than WPM, so it seems like value investors will conclude that NEXA is the superior option right now.
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Nexa Resources S.A. (NEXA) : Free Stock Analysis Report
Wheaton Precious Metals Corp. (WPM) : Free Stock Analysis Report
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