Investors with an interest in Banks - Foreign stocks have likely encountered both National Bank of Canada (NTIOF) and Commonwealth Bank of Australia Sponsored ADR (CMWAY). 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, National Bank of Canada is sporting a Zacks Rank of #2 (Buy), while Commonwealth Bank of Australia Sponsored ADR has a Zacks Rank of #3 (Hold). This means that NTIOF's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

NTIOF currently has a forward P/E ratio of 16.68, while CMWAY has a forward P/E of 28.16. We also note that NTIOF has a PEG ratio of 1.39. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CMWAY currently has a PEG ratio of 5.29.

Another notable valuation metric for NTIOF is its P/B ratio of 2.69. 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, CMWAY has a P/B of 4.3.

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

NTIOF has seen stronger estimate revision activity and sports more attractive valuation metrics than CMWAY, so it seems like value investors will conclude that NTIOF is the superior option right now.

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National Bank of Canada (NTIOF):Free Stock Analysis Report

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

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