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ESRT vs. EGP: Which Stock Should Value Investors Buy Now?

Zacks Equity Research
·2 min read

Investors with an interest in REIT and Equity Trust - Other stocks have likely encountered both Empire State Realty Trust (ESRT) and EastGroup Properties (EGP). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Empire State Realty Trust has a Zacks Rank of #2 (Buy), while EastGroup Properties has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that ESRT likely has seen a stronger improvement to its earnings outlook than EGP has recently. But this is just one factor that value investors are interested in.

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.

ESRT currently has a forward P/E ratio of 10.29, while EGP has a forward P/E of 24.73. We also note that ESRT has a PEG ratio of 1.27. 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. EGP currently has a PEG ratio of 3.26.

Another notable valuation metric for ESRT is its P/B ratio of 0.80. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, EGP has a P/B of 4.14.

Based on these metrics and many more, ESRT holds a Value grade of B, while EGP has a Value grade of D.

ESRT stands above EGP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ESRT is the superior value option right now.


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Empire State Realty Trust, Inc. (ESRT) : Free Stock Analysis Report
 
EastGroup Properties, Inc. (EGP) : Free Stock Analysis Report
 
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