Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Alpine Income (PINE) and Crown Castle (CCI). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Alpine Income and Crown Castle are both sporting a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is only part of the picture 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.
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.
PINE currently has a forward P/E ratio of 10.76, while CCI has a forward P/E of 14.94. We also note that PINE has a PEG ratio of 1.79. 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. CCI currently has a PEG ratio of 2.62.
Another notable valuation metric for PINE is its P/B ratio of 0.88. 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, CCI has a P/B of 7.99.
Based on these metrics and many more, PINE holds a Value grade of B, while CCI has a Value grade of D.
Both PINE and CCI are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PINE is the superior value option right now.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
