Investors interested in Financial - Investment Management stocks are likely familiar with Patria Investments (PAX) and KKR & Co. Inc. (KKR). 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.
Patria Investments has a Zacks Rank of #2 (Buy), while KKR & Co. Inc. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PAX is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
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.
PAX currently has a forward P/E ratio of 12.00, while KKR has a forward P/E of 23.03. We also note that PAX has a PEG ratio of 0.81. 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. KKR currently has a PEG ratio of 1.17.
Another notable valuation metric for PAX is its P/B ratio of 1.5. 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, KKR has a P/B of 1.58.
Based on these metrics and many more, PAX holds a Value grade of A, while KKR has a Value grade of D.
PAX stands above KKR thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PAX is the superior value option right now.
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Patria Investments Limited (PAX): Free Stock Analysis Report KKR & Co. Inc. (KKR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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