Yahoo Finance NMIH or BRK.B: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Insurance - Property and Casualty sector have probably already heard of NMI Holdings (NMIH) and Berkshire Hathaway B (BRK.B). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, NMI Holdings is sporting a Zacks Rank of #2 (Buy), while Berkshire Hathaway B has a Zacks Rank of #3 (Hold). This means that NMIH's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst 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.
NMIH currently has a forward P/E ratio of 8.10, while BRK.B has a forward P/E of 22.30. We also note that NMIH has a PEG ratio of 1.17. 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. BRK.B currently has a PEG ratio of 3.19.
Another notable valuation metric for NMIH is its P/B ratio of 1.38. 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, BRK.B has a P/B of 1.54.
Based on these metrics and many more, NMIH holds a Value grade of B, while BRK.B has a Value grade of C.
NMIH stands above BRK.B thanks to its solid earnings outlook, and based on these valuation figures, we also feel that NMIH is the superior value option right now.
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NMI Holdings Inc (NMIH) : Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
