Yahoo Finance TSCDY vs. WMMVY: Which Stock Is the Better Value Option?
Investors with an interest in Retail - Supermarkets stocks have likely encountered both Tesco PLC (TSCDY) and Wal-Mart de Mexico SAB de CV (WMMVY). 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Tesco PLC and Wal-Mart de Mexico SAB de CV are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TSCDY has an improving earnings outlook. However, value investors will care about much more than just this.
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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
TSCDY currently has a forward P/E ratio of 10.94, while WMMVY has a forward P/E of 19.62. We also note that TSCDY has a PEG ratio of 1.34. 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. WMMVY currently has a PEG ratio of 2.39.
Another notable valuation metric for TSCDY is its P/B ratio of 1.63. 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, WMMVY has a P/B of 6.51.
These metrics, and several others, help TSCDY earn a Value grade of A, while WMMVY has been given a Value grade of C.
TSCDY 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 TSCDY is likely the superior value option right now.
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Tesco PLC (TSCDY) : Free Stock Analysis Report
Wal-Mart de Mexico SAB de CV (WMMVY) : Free Stock Analysis Report
