BNPQY vs. NABZY: Which Stock Is the Better Value Option?

Investors looking for stocks in the Banks - Foreign sector might want to consider either BNP Paribas SA (BNPQY) or National Australia Bank Ltd. (NABZY). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Currently, both BNP Paribas SA and National Australia Bank Ltd. are holding a Zacks Rank of #2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

BNPQY currently has a forward P/E ratio of 7.27, while NABZY has a forward P/E of 18.21. We also note that BNPQY has a PEG ratio of 0.60. 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. NABZY currently has a PEG ratio of 3.44.

Another notable valuation metric for BNPQY is its P/B ratio of 0.74. 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, NABZY has a P/B of 2.45.

These metrics, and several others, help BNPQY earn a Value grade of A, while NABZY has been given a Value grade of D.

Both BNPQY and NABZY are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BNPQY is the superior value option right now.

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BNP Paribas SA (BNPQY): Free Stock Analysis Report

National Australia Bank Ltd. (NABZY): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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