Yahoo Finance LOMA vs. DHI: Which Stock Is the Better Value Option?
Investors with an interest in Building Products - Home Builders stocks have likely encountered both Loma Negra Compania Industrial Argentina S.A. Sponsored ADR (LOMA) and D.R. Horton (DHI). 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, both Loma Negra Compania Industrial Argentina S.A. Sponsored ADR and D.R. Horton are sporting a Zacks Rank of # 1 (Strong Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is only part of the picture for value investors.
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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
LOMA currently has a forward P/E ratio of 5.46, while DHI has a forward P/E of 9.98. We also note that LOMA has a PEG ratio of 0.17. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DHI currently has a PEG ratio of 0.64.
Another notable valuation metric for LOMA is its P/B ratio of 0.97. 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, DHI has a P/B of 1.77.
These metrics, and several others, help LOMA earn a Value grade of A, while DHI has been given a Value grade of C.
Both LOMA and DHI are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that LOMA is the superior value option right now.
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Loma Negra Compania Industrial Argentina S.A. Sponsored ADR (LOMA) : Free Stock Analysis Report
D.R. Horton, Inc. (DHI) : Free Stock Analysis Report
