PAGS or MA: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Financial Transaction Services sector might want to consider either PagSeguro Digital Ltd. (PAGS) or MasterCard (MA). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, both PagSeguro Digital Ltd. and MasterCard 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. However, value investors will care about much more than just this.
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.
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.
PAGS currently has a forward P/E ratio of 10.70, while MA has a forward P/E of 32.58. We also note that PAGS has a PEG ratio of 1.04. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MA currently has a PEG ratio of 1.77.
Another notable valuation metric for PAGS is its P/B ratio of 1.62. 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, MA has a P/B of 62.94.
Based on these metrics and many more, PAGS holds a Value grade of A, while MA has a Value grade of D.
Both PAGS and MA are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PAGS is the superior value option right now.
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PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report
Mastercard Incorporated (MA) : Free Stock Analysis Report
