WTFC vs. FIBK: Which Stock Is the Better Value Option?
Investors looking for stocks in the Banks - Midwest sector might want to consider either Wintrust Financial (WTFC) or First Interstate BancSystem (FIBK). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Wintrust Financial is sporting a Zacks Rank of #2 (Buy), while First Interstate BancSystem has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that WTFC likely has seen a stronger improvement to its earnings outlook than FIBK has recently. 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 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.
WTFC currently has a forward P/E ratio of 14.58, while FIBK has a forward P/E of 15.71. We also note that WTFC has a PEG ratio of 1.08. 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. FIBK currently has a PEG ratio of 1.75.
Another notable valuation metric for WTFC is its P/B ratio of 1.66. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, FIBK has a P/B of 1.79.
Based on these metrics and many more, WTFC holds a Value grade of B, while FIBK has a Value grade of C.
WTFC 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 WTFC is likely the superior value option right now.
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Wintrust Financial Corporation (WTFC) : Free Stock Analysis Report
First Interstate BancSystem, Inc. (FIBK) : Free Stock Analysis Report
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