Investors with an interest in Financial - Miscellaneous Services stocks have likely encountered both Orix (IX) and Circle Internet Group, Inc. (CRCL). 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 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, Orix is sporting a Zacks Rank of #2 (Buy), while Circle Internet Group, Inc. has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that IX likely has seen a stronger improvement to its earnings outlook than CRCL has recently. But this is just one piece of the puzzle 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.
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.
IX currently has a forward P/E ratio of 13.07, while CRCL has a forward P/E of 72.51. We also note that IX has a PEG ratio of 1.03. 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. CRCL currently has a PEG ratio of 3.02.
Another notable valuation metric for IX is its P/B ratio of 1.26. 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, CRCL has a P/B of 4.66.
Based on these metrics and many more, IX holds a Value grade of A, while CRCL has a Value grade of D.
IX has seen stronger estimate revision activity and sports more attractive valuation metrics than CRCL, so it seems like value investors will conclude that IX is the superior option right now.
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Orix Corp Ads (IX): Free Stock Analysis Report Circle Internet Group, Inc. (CRCL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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