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PGRE or CUBE: Which Is the Better Value Stock Right Now?

Zacks Equity Research
·2 min read

Investors interested in REIT and Equity Trust - Other stocks are likely familiar with Paramount Group (PGRE) and CubeSmart (CUBE). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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 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.

Paramount Group and CubeSmart are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PGRE has an improving earnings outlook. But this is just one piece of the puzzle 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.

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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.

PGRE currently has a forward P/E ratio of 7.91, while CUBE has a forward P/E of 16.29. We also note that PGRE has a PEG ratio of 6.59. 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. CUBE currently has a PEG ratio of 7.54.

Another notable valuation metric for PGRE is its P/B ratio of 0.37. 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, CUBE has a P/B of 2.85.

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

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


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Paramount Group, Inc. (PGRE) : Free Stock Analysis Report
 
CubeSmart (CUBE) : Free Stock Analysis Report
 
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Zacks Investment Research