QFIN or RKT: Which Is the Better Value Stock Right Now?
Investors interested in Technology Services stocks are likely familiar with Qifu Technology, Inc. (QFIN) and Rocket Companies (RKT). But which of these two companies is the best option for those looking for undervalued stocks? 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 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.
Qifu Technology, Inc. has a Zacks Rank of #2 (Buy), while Rocket Companies has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that QFIN 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 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.
QFIN currently has a forward P/E ratio of 3.46, while RKT has a forward P/E of 34.94. We also note that QFIN has a PEG ratio of 0.33. 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. RKT currently has a PEG ratio of 6.99.
Another notable valuation metric for QFIN is its P/B ratio of 0.81. 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, RKT has a P/B of 2.70.
These are just a few of the metrics contributing to QFIN's Value grade of A and RKT's Value grade of D.
QFIN 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 QFIN is likely the superior value option right now.
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Qifu Technology, Inc. (QFIN) : Free Stock Analysis Report
Rocket Companies, Inc. (RKT) : Free Stock Analysis Report
