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Investors interested in stocks from the Insurance - Multi line sector have probably already heard of Zurich Insurance Group Ltd. (ZURVY) and Goosehead Insurance (GSHD). But which of these two companies is the best option for those looking for undervalued stocks? 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.
Zurich Insurance Group Ltd. and Goosehead Insurance are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that ZURVY likely has seen a stronger improvement to its earnings outlook than GSHD 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.
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.
ZURVY currently has a forward P/E ratio of 7.62, while GSHD has a forward P/E of 65.18. We also note that ZURVY has a PEG ratio of 0.44. 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. GSHD currently has a PEG ratio of 2.11.
Another notable valuation metric for ZURVY is its P/B ratio of 3.36. 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, GSHD has a P/B of 1,734.60.
These are just a few of the metrics contributing to ZURVY's Value grade of B and GSHD's Value grade of F.
ZURVY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ZURVY is likely the superior value option right now.
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Zurich Insurance Group Ltd. (ZURVY) : Free Stock Analysis Report
Goosehead Insurance (GSHD) : Free Stock Analysis Report