SYF vs. BX: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Synchrony (SYF) or Blackstone Inc. (BX). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Synchrony has a Zacks Rank of #2 (Buy), while Blackstone Inc. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that SYF is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
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 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.
SYF currently has a forward P/E ratio of 5.53, while BX has a forward P/E of 23.47. We also note that SYF has a PEG ratio of 1.25. 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. BX currently has a PEG ratio of 2.22.
Another notable valuation metric for SYF is its P/B ratio of 0.89. 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, BX has a P/B of 3.75.
Based on these metrics and many more, SYF holds a Value grade of A, while BX has a Value grade of D.
SYF stands above BX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SYF is the superior value option right now.
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Synchrony Financial (SYF) : Free Stock Analysis Report
Blackstone Inc. (BX) : Free Stock Analysis Report
