NXST or NFLX: Which Is the Better Value Stock Right Now?
Investors with an interest in Broadcast Radio and Television stocks have likely encountered both Nexstar Broadcasting Group (NXST) and Netflix (NFLX). 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Nexstar Broadcasting Group has a Zacks Rank of #1 (Strong Buy), while Netflix 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 NXST has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
NXST currently has a forward P/E ratio of 9.95, while NFLX has a forward P/E of 30.92. We also note that NXST has a PEG ratio of 1. 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. NFLX currently has a PEG ratio of 3.63.
Another notable valuation metric for NXST is its P/B ratio of 2.52. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, NFLX has a P/B of 7.07.
These are just a few of the metrics contributing to NXST's Value grade of A and NFLX's Value grade of C.
NXST 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 NXST is likely the superior value option right now.
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Nexstar Media Group, Inc (NXST) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
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