ESRT vs. NHI: Which Stock Should Value Investors Buy Now?
Investors with an interest in REIT and Equity Trust - Other stocks have likely encountered both Empire State Realty Trust (ESRT) and National Health Investors (NHI). 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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.
Currently, both Empire State Realty Trust and National Health Investors are holding a Zacks Rank of # 2 (Buy). Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. 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 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.
ESRT currently has a forward P/E ratio of 11.38, while NHI has a forward P/E of 17.59. We also note that ESRT has a PEG ratio of 6.47. 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. NHI currently has a PEG ratio of 8.38.
Another notable valuation metric for ESRT is its P/B ratio of 1.02. 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, NHI has a P/B of 2.77.
These metrics, and several others, help ESRT earn a Value grade of B, while NHI has been given a Value grade of D.
Both ESRT and NHI are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ESRT is the superior value option right now.
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Empire State Realty Trust, Inc. (ESRT) : Free Stock Analysis Report
National Health Investors, Inc. (NHI) : Free Stock Analysis Report