PAX vs. SEIC: Which Stock Should Value Investors Buy Now?
Investors interested in Financial - Investment Management stocks are likely familiar with Patria Investments (PAX) and SEI Investments (SEIC). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Patria Investments has a Zacks Rank of #1 (Strong Buy), while SEI Investments has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that PAX likely has seen a stronger improvement to its earnings outlook than SEIC has recently. But this is only part of the picture for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
PAX currently has a forward P/E ratio of 15.58, while SEIC has a forward P/E of 17.90. We also note that PAX has a PEG ratio of 0.90. 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. SEIC currently has a PEG ratio of 1.49.
Another notable valuation metric for PAX is its P/B ratio of 1.36. 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, SEIC has a P/B of 4.26.
These are just a few of the metrics contributing to PAX's Value grade of B and SEIC's Value grade of C.
PAX 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 PAX is likely the superior value option right now.
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Patria Investments Limited (PAX) : Free Stock Analysis Report
SEI Investments Company (SEIC) : Free Stock Analysis Report
