Investors with an interest in Financial - Investment Management stocks have likely encountered both Patria Investments (PAX) and Carlyle Group (CG). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Patria Investments has a Zacks Rank of #1 (Strong Buy), while Carlyle Group has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that PAX likely has seen a stronger improvement to its earnings outlook than CG has recently. 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.

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.

PAX currently has a forward P/E ratio of 8.46, while CG has a forward P/E of 11.36. We also note that PAX has a PEG ratio of 0.66. 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. CG currently has a PEG ratio of 1.13.

Another notable valuation metric for PAX is its P/B ratio of 1.48. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CG has a P/B of 2.81.

These are just a few of the metrics contributing to PAX's Value grade of A and CG's Value grade of D.

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

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This article originally published on Zacks Investment Research (zacks.com).

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