Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Virtu Financial (VIRT) or American Express (AXP). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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, Virtu Financial has a Zacks Rank of #1 (Strong Buy), while American Express has a Zacks Rank of #2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that VIRT 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 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.
VIRT currently has a forward P/E ratio of 12, while AXP has a forward P/E of 20.69. We also note that VIRT has a PEG ratio of 0.45. 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. AXP currently has a PEG ratio of 1.48.
Another notable valuation metric for VIRT is its P/B ratio of 4.24. 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, AXP has a P/B of 7.38.
Based on these metrics and many more, VIRT holds a Value grade of B, while AXP has a Value grade of C.
VIRT stands above AXP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that VIRT is the superior value option right now.
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Virtu Financial, Inc. (VIRT) : Free Stock Analysis Report
American Express Company (AXP) : Free Stock Analysis Report
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