Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both Euronet Worldwide (EEFT) and Coinbase Global, Inc. (COIN). 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Right now, Euronet Worldwide is sporting a Zacks Rank of #2 (Buy), while Coinbase Global, Inc. has a Zacks Rank of #3 (Hold). This means that EEFT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.
EEFT currently has a forward P/E ratio of 10.77, while COIN has a forward P/E of 120.54. We also note that EEFT has a PEG ratio of 0.72. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. COIN currently has a PEG ratio of 44.98.
Another notable valuation metric for EEFT is its P/B ratio of 3.52. 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, COIN has a P/B of 8.66.
These are just a few of the metrics contributing to EEFT's Value grade of A and COIN's Value grade of F.
EEFT stands above COIN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that EEFT is the superior value option right now.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
