IX vs. MCO: Which Stock Offers Greater Value?

Comparing Value in Financial Services: Orix vs. Moody's

If you're interested in the Financial - Miscellaneous Services sector, you may be considering Orix (IX) or Moody's (MCO). But which stock currently presents a stronger value opportunity for investors? Let's break down the details.

How to Identify Value Stocks

There are many ways to spot value stocks, but combining a high Zacks Rank with a strong Value score from their Style Scores system has historically delivered solid results. The Zacks Rank focuses on positive changes in earnings estimates, while Style Scores highlight stocks with favorable characteristics.

Current Rankings and Value Metrics

Both Orix and Moody's currently hold a Zacks Rank of #2 (Buy), indicating that analysts have recently raised their earnings expectations for these companies. While this is a positive sign, value investors often look deeper, examining classic valuation ratios to find stocks trading below their intrinsic worth.

Key Valuation Ratios

• Forward P/E Ratio: Orix is trading at 13.70, while Moody's stands at 27.76.
• PEG Ratio: Orix has a PEG of 0.86, which factors in expected earnings growth, compared to Moody's 2.40.
• P/B Ratio: Orix's price-to-book is 1.34, whereas Moody's is much higher at 19.66.

These figures, along with other financial metrics, contribute to Orix receiving an 'A' grade for value, while Moody's earns an 'F' in the same category.

Which Stock Offers Better Value?

Both companies show promising earnings prospects, but based on the valuation data, Orix stands out as the more attractive value pick at this time.

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