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Investors interested in stocks from the Banks - Foreign sector have probably already heard of Grupo Supervielle (SUPV) and Royal Bank (RY). 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 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.
Currently, Grupo Supervielle has a Zacks Rank of #2 (Buy), while Royal Bank has a Zacks Rank of #4 (Sell). This means that SUPV's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
SUPV currently has a forward P/E ratio of 3.36, while RY has a forward P/E of 11.47. We also note that SUPV has a PEG ratio of 1.77. 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. RY currently has a PEG ratio of 2.21.
Another notable valuation metric for SUPV is its P/B ratio of 0.41. 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, RY has a P/B of 1.48.
These metrics, and several others, help SUPV earn a Value grade of A, while RY has been given a Value grade of C.
SUPV sticks out from RY in both our Zacks Rank and Style Scores models, so value investors will likely feel that SUPV is the better option right now.
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Grupo Supervielle S.A. (SUPV) : Free Stock Analysis Report
Royal Bank Of Canada (RY) : Free Stock Analysis Report
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