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GBOOY vs. MCO: Which Stock Should Value Investors Buy Now?

Investors looking for stocks in the Financial - Miscellaneous Services sector might want to consider either Grupo Financiero Banorte SAB de CV (GBOOY) or Moody's (MCO). But which of these two stocks presents investors with the better value opportunity right now? Let's 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.

Grupo Financiero Banorte SAB de CV has a Zacks Rank of #2 (Buy), while Moody's has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that GBOOY has an improving earnings outlook. But this is only part of the picture 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.

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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.

GBOOY currently has a forward P/E ratio of 7.96, while MCO has a forward P/E of 32.42. We also note that GBOOY has a PEG ratio of 0.66. 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. MCO currently has a PEG ratio of 2.95.

Another notable valuation metric for GBOOY is its P/B ratio of 1.96. 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, MCO has a P/B of 19.01.

These are just a few of the metrics contributing to GBOOY's Value grade of B and MCO's Value grade of F.

GBOOY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that GBOOY is likely the superior value option right now.

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Grupo Financiero Banorte SAB de CV (GBOOY) : Free Stock Analysis Report

Moody's Corporation (MCO) : Free Stock Analysis Report

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Zacks Investment Research