SAN or NABZY: Which Is the Better Value Stock Right Now?
Investors interested in Banks - Foreign stocks are likely familiar with Banco Santander (SAN) and National Australia Bank Ltd. (NABZY). 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.
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.
Banco Santander has a Zacks Rank of #2 (Buy), while National Australia Bank Ltd. has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SAN has an improving earnings outlook. But this is only part of the picture 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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
SAN currently has a forward P/E ratio of 5.75, while NABZY has a forward P/E of 17.65. We also note that SAN has a PEG ratio of 0.38. 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. NABZY currently has a PEG ratio of 0.47.
Another notable valuation metric for SAN is its P/B ratio of 0.68. 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, NABZY has a P/B of 2.
These are just a few of the metrics contributing to SAN's Value grade of B and NABZY's Value grade of D.
SAN stands above NABZY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SAN is the superior value option right now.
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Banco Santander, S.A. (SAN) : Free Stock Analysis Report
National Australia Bank Ltd. (NABZY) : Free Stock Analysis Report