RHP or PSA: Which Is the Better Value Stock Right Now?

Investors with an interest in REIT and Equity Trust - Other stocks have likely encountered both Ryman Hospitality Properties (RHP) and Public Storage (PSA). 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.

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.

Ryman Hospitality Properties and Public Storage 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 RHP has an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

RHP currently has a forward P/E ratio of 13.24, while PSA has a forward P/E of 19.24. We also note that RHP has a PEG ratio of 2.15. 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. PSA currently has a PEG ratio of 3.84.

Another notable valuation metric for RHP is its P/B ratio of 9.57. 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, PSA has a P/B of 11.59.

These are just a few of the metrics contributing to RHP's Value grade of B and PSA's Value grade of D.

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

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This article originally published on Zacks Investment Research (zacks.com).

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