Should Value Investors Buy Empire State Realty Trust (ESRT) Stock?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Empire State Realty Trust (ESRT). ESRT is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 9.27. This compares to its industry's average Forward P/E of 14.99. Over the last 12 months, ESRT's Forward P/E has been as high as 10.36 and as low as 6.42, with a median of 8.37.
Another notable valuation metric for ESRT is its P/B ratio of 0.77. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.74. ESRT's P/B has been as high as 0.86 and as low as 0.53, with a median of 0.69, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ESRT has a P/S ratio of 1.76. This compares to its industry's average P/S of 3.95.
Finally, our model also underscores that ESRT has a P/CF ratio of 8.33. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 14.76. Within the past 12 months, ESRT's P/CF has been as high as 8.84 and as low as 5.67, with a median of 7.30.
If you're looking for another solid REIT and Equity Trust - Other value stock, take a look at Paramount Group (PGRE). PGRE is a # 2 (Buy) stock with a Value score of A.
Paramount Group is currently trading with a Forward P/E ratio of 5.89 while its PEG ratio sits at 0.53. Both of the company's metrics compare favorably to its industry's average P/E of 14.99 and average PEG ratio of 2.23.
PGRE's Forward P/E has been as high as 8.11 and as low as 4.47, with a median of 6.38. During the same time period, its PEG ratio has been as high as 0.53, as low as 0.41, with a median of 0.46.
Paramount Group also has a P/B ratio of 0.25 compared to its industry's price-to-book ratio of 1.74. Over the past year, its P/B ratio has been as high as 0.40, as low as 0.20, with a median of 0.30.
These are just a handful of the figures considered in Empire State Realty Trust and Paramount Group's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ESRT and PGRE is an impressive value stock right now.
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Empire State Realty Trust, Inc. (ESRT) : Free Stock Analysis Report
Paramount Group, Inc. (PGRE) : Free Stock Analysis Report
