Advertisement
Australia markets closed
  • ALL ORDS

    8,166.40
    -42.80 (-0.52%)
     
  • AUD/USD

    0.6643
    -0.0043 (-0.64%)
     
  • ASX 200

    7,931.70
    -39.90 (-0.50%)
     
  • OIL

    79.50
    -0.63 (-0.79%)
     
  • GOLD

    2,399.30
    +0.20 (+0.01%)
     
  • Bitcoin AUD

    101,883.59
    +1,100.30 (+1.09%)
     
  • CMC Crypto 200

    1,395.24
    -10.09 (-0.72%)
     

PGRE or OHI: Which Is the Better Value Stock Right Now?

Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Paramount Group (PGRE) and Omega Healthcare Investors (OHI). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 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.

Currently, both Paramount Group and Omega Healthcare Investors are holding a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

ADVERTISEMENT

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.

PGRE currently has a forward P/E ratio of 5.99, while OHI has a forward P/E of 11.93. We also note that PGRE has a PEG ratio of 0.23. 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. OHI currently has a PEG ratio of 1.15.

Another notable valuation metric for PGRE is its P/B ratio of 0.25. 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, OHI has a P/B of 2.19.

Based on these metrics and many more, PGRE holds a Value grade of A, while OHI has a Value grade of C.

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

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

Paramount Group, Inc. (PGRE) : Free Stock Analysis Report

Omega Healthcare Investors, Inc. (OHI) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research