Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Corporate Office Properties (NYSE:OFC) and Healthpeak (PEAK). But which of these two stocks presents investors with the better value opportunity right now? 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Corporate Office Properties and Healthpeak are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that OFC's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
OFC currently has a forward P/E ratio of 12.16, while PEAK has a forward P/E of 16.14. We also note that OFC has a PEG ratio of 2.75. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PEAK currently has a PEG ratio of 4.01.
Another notable valuation metric for OFC is its P/B ratio of 1.69. 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, PEAK has a P/B of 1.74.
Based on these metrics and many more, OFC holds a Value grade of B, while PEAK has a Value grade of D.
OFC stands above PEAK thanks to its solid earnings outlook, and based on these valuation figures, we also feel that OFC is the superior value option right now.
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Corporate Office Properties Trust (OFC): Free Stock Analysis Report
Healthpeak Properties, Inc. (NYSE:PEAK): Free Stock Analysis Report
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