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ATCO vs. TROW: Which Stock Is the Better Value Option?

Zacks Equity Research
·2 min read

Investors looking for stocks in the Financial - Investment Management sector might want to consider either Atlas (ATCO) or T. Rowe Price (TROW). 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.

Atlas and T. Rowe Price are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ATCO has an improving earnings 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.

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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.

ATCO currently has a forward P/E ratio of 9.52, while TROW has a forward P/E of 13.02. We also note that ATCO has a PEG ratio of 2.38. 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. TROW currently has a PEG ratio of 2.65.

Another notable valuation metric for ATCO is its P/B ratio of 0.97. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, TROW has a P/B of 2.52.

These are just a few of the metrics contributing to ATCO's Value grade of A and TROW's Value grade of C.

ATCO sticks out from TROW in both our Zacks Rank and Style Scores models, so value investors will likely feel that ATCO is the better option right now.


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Atlas Corp. (ATCO) : Free Stock Analysis Report
 
T. Rowe Price Group, Inc. (TROW) : Free Stock Analysis Report
 
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Zacks Investment Research