NMR vs. TW: Which Stock Is the Better Value Option?
Investors with an interest in Financial - Investment Bank stocks have likely encountered both Nomura Holdings (NMR) and Tradeweb Markets (TW). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 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, Nomura Holdings is sporting a Zacks Rank of #2 (Buy), while Tradeweb Markets has a Zacks Rank of #3 (Hold). This means that NMR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
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.
NMR currently has a forward P/E ratio of 6.10, while TW has a forward P/E of 43.51. We also note that NMR has a PEG ratio of 0.12. 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. TW currently has a PEG ratio of 2.20.
Another notable valuation metric for NMR is its P/B ratio of 0.58. 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, TW has a P/B of 2.57.
These metrics, and several others, help NMR earn a Value grade of B, while TW has been given a Value grade of D.
NMR stands above TW thanks to its solid earnings outlook, and based on these valuation figures, we also feel that NMR is the superior value option right now.
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Nomura Holdings Inc ADR (NMR): Free Stock Analysis Report
Tradeweb Markets Inc. (TW): Free Stock Analysis Report
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