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HAS or TTWO: Which Is the Better Value Stock Right Now?

Zacks Equity Research
·2 min read

Investors looking for stocks in the Toys - Games - Hobbies sector might want to consider either Hasbro (HAS) or Take-Two Interactive (TTWO). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Hasbro has a Zacks Rank of #2 (Buy), while Take-Two Interactive has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that HAS has an improving earnings outlook. 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 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.

HAS currently has a forward P/E ratio of 19.40, while TTWO has a forward P/E of 32.34. We also note that HAS has a PEG ratio of 1.10. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. TTWO currently has a PEG ratio of 2.94.

Another notable valuation metric for HAS is its P/B ratio of 4.49. 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, TTWO has a P/B of 4.66.

These metrics, and several others, help HAS earn a Value grade of B, while TTWO has been given a Value grade of D.

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


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Hasbro, Inc. (HAS) : Free Stock Analysis Report
 
TakeTwo Interactive Software, Inc. (TTWO) : Free Stock Analysis Report
 
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