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CSR vs. ESS: Which Stock Is the Better Value Option?

Investors interested in REIT and Equity Trust - Residential stocks are likely familiar with Centerspace (CSR) and Essex Property Trust (ESS). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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, Centerspace has a Zacks Rank of #2 (Buy), while Essex Property Trust has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CSR is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

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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.

CSR currently has a forward P/E ratio of 12.81, while ESS has a forward P/E of 15.82. We also note that CSR has a PEG ratio of 1.83. 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. ESS currently has a PEG ratio of 3.53.

Another notable valuation metric for CSR is its P/B ratio of 1.09. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, ESS has a P/B of 2.75.

These metrics, and several others, help CSR earn a Value grade of B, while ESS has been given a Value grade of F.

CSR has seen stronger estimate revision activity and sports more attractive valuation metrics than ESS, so it seems like value investors will conclude that CSR is the superior option right now.

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Centerspace (CSR) : Free Stock Analysis Report

Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report

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Zacks Investment Research