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KT vs. DCMYY: Which Stock Is the Better Value Option?

Zacks

Investors interested in Wireless Non-US stocks are likely familiar with KT Corp. (KT) and NTT Docomo (DCMYY). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

KT Corp. and NTT Docomo are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that KT is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.

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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.

KT currently has a forward P/E ratio of 11.37, while DCMYY has a forward P/E of 13.27. We also note that KT has a PEG ratio of 1.08. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DCMYY currently has a PEG ratio of 3.41.

Another notable valuation metric for KT is its P/B ratio of 0.56. 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, DCMYY has a P/B of 1.60.

Based on these metrics and many more, KT holds a Value grade of A, while DCMYY has a Value grade of C.

KT 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 KT is likely the superior value option right now.


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KT Corporation (KT) : Free Stock Analysis Report
 
NTT DOCOMO, Inc (DCMYY) : Free Stock Analysis Report
 
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