News

We provide the latest news
from the world of economics and finance

Back
15 July
VCTR vs. BLK: Which Stock Should Value Investors Buy Now?

Investors looking for stocks in the Financial - Investment Management sector might want to consider either Victory Capital Holdings (VCTR) or BlackRock (BLK). But which of these two stocks presents investors with the better value opportunity right now? Let's 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.

Victory Capital Holdings has a Zacks Rank of #2 (Buy), while BlackRock has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that VCTR likely has seen a stronger improvement to its earnings outlook than BLK has recently. However, value investors will care about much more than just this.

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.

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.

VCTR currently has a forward P/E ratio of 9.68, while BLK has a forward P/E of 20.09. We also note that VCTR has a PEG ratio of 0.57. 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. BLK currently has a PEG ratio of 1.71.

Another notable valuation metric for VCTR is its P/B ratio of 3.06. 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, BLK has a P/B of 3.09.

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

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

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Victory Capital Holdings, Inc. (VCTR) : Free Stock Analysis Report

BlackRock, Inc. (BLK) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.