Investors interested in Transportation – Airline stocks are likely familiar with Deutsche Lufthansa AG (DLAKY) and Swire Pacific (SWRAY). But which of these two stocks is more attractive to value investors? We’ll need to take a closer look to find out.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Deutsche Lufthansa AG and Swire Pacific are both sporting a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. 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.

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.

DLAKY currently has a forward P/E ratio of 7.53, while SWRAY has a forward P/E of 9.67. We also note that DLAKY has a PEG ratio of 0.24. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company’s expected earnings growth rate. SWRAY currently has a PEG ratio of 0.70.

Another notable valuation metric for DLAKY is its P/B ratio of 0.68. 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, SWRAY has a P/B of 0.72.

These are just a few of the metrics contributing to DLAKY’s Value grade of B and SWRAY’s Value grade of C.

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

4 Oil Stocks with Massive Upsides

Global demand for oil is through the roof… and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with “black gold.” 

Zacks Investment Research has just released an urgent special report to help you bank on this trend. 

In Oil Market on Fire, you’ll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don’t want to miss these recommendations. 

Download your free report now to see them.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Deutsche Lufthansa AG (DLAKY) : Free Stock Analysis Report

Swire Pacific Ltd. (SWRAY) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Source: Nasdaq

LEAVE A REPLY

Please enter your comment!
Please enter your name here