BSAC or MFG: Which Is the Better Value Stock Right Now?
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Investors with an interest in Banks - Foreign stocks have likely encountered both Banco Santander-Chile (BSAC) and Mizuho (MFG). 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 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, Banco Santander-Chile is sporting a Zacks Rank of #2 (Buy), while Mizuho has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BSAC likely has seen a stronger improvement to its earnings outlook than MFG has recently. But this is just one factor that value investors are interested in.
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.
BSAC currently has a forward P/E ratio of 10.73, while MFG has a forward P/E of 11.12. We also note that BSAC has a PEG ratio of 0.41. 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. MFG currently has a PEG ratio of 0.80.
Another notable valuation metric for BSAC is its P/B ratio of 1.97. 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, MFG has a P/B of 7.94.
These metrics, and several others, help BSAC earn a Value grade of B, while MFG has been given a Value grade of C.
BSAC 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 BSAC is likely the superior value option right now.
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Banco Santander Chile (BSAC) : Free Stock Analysis Report
Mizuho Financial Group, Inc. (MFG) : Free Stock Analysis Report