DNBBY vs. RY: Which Stock Should Value Investors Buy Now?
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Investors with an interest in Banks - Foreign stocks have likely encountered both DNB Bank ASA (DNBBY) and Royal Bank (RY). 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, DNB Bank ASA has a Zacks Rank of #2 (Buy), while Royal Bank has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that DNBBY likely has seen a stronger improvement to its earnings outlook than RY has recently. 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 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.
DNBBY currently has a forward P/E ratio of 8.66, while RY has a forward P/E of 12.05. We also note that DNBBY has a PEG ratio of 1.59. 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. RY currently has a PEG ratio of 1.76.
Another notable valuation metric for DNBBY is its P/B ratio of 1.32. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, RY has a P/B of 1.80.
These are just a few of the metrics contributing to DNBBY's Value grade of B and RY's Value grade of D.
DNBBY sticks out from RY in both our Zacks Rank and Style Scores models, so value investors will likely feel that DNBBY is the better option right now.
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DNB Bank ASA (DNBBY) : Free Stock Analysis Report
Royal Bank Of Canada (RY) : Free Stock Analysis Report