Yahoo Finance ARREF vs. SCCO: Which Stock Is the Better Value Option?
Investors interested in stocks from the Mining - Non Ferrous sector have probably already heard of Amerigo Resources (ARREF) and Southern Copper (SCCO). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Amerigo Resources is sporting a Zacks Rank of #2 (Buy), while Southern Copper has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ARREF has an improving earnings outlook. But this is only part of the picture for value investors.
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.
ARREF currently has a forward P/E ratio of 11.82, while SCCO has a forward P/E of 19.69. We also note that ARREF has a PEG ratio of 0.59. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SCCO currently has a PEG ratio of 3.
Another notable valuation metric for ARREF is its P/B ratio of 1.74. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SCCO has a P/B of 7.34.
These are just a few of the metrics contributing to ARREF's Value grade of A and SCCO's Value grade of D.
ARREF 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 ARREF is likely the superior value option right now.
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Amerigo Resources Ltd. (ARREF) : Free Stock Analysis Report
Southern Copper Corporation (SCCO) : Free Stock Analysis Report
