TRTX vs. VTMX: Which Stock Is the Better Value Option?

Zacks
17 Apr

Investors interested in stocks from the Real Estate - Operations sector have probably already heard of TPG RE Finance Trust (TRTX) and Corporacion Inmobiliaria Vesta, S.A.B. de C.V. Sponsored ADR (VTMX). 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

TPG RE Finance Trust and Corporacion Inmobiliaria Vesta, S.A.B. de C.V. Sponsored ADR are both sporting a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is only part of the picture for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

TRTX currently has a forward P/E ratio of 6.88, while VTMX has a forward P/E of 10.16. We also note that TRTX has a PEG ratio of 1.48. 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. VTMX currently has a PEG ratio of 2.64.

Another notable valuation metric for TRTX is its P/B ratio of 0.51. 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, VTMX has a P/B of 7.77.

Based on these metrics and many more, TRTX holds a Value grade of B, while VTMX has a Value grade of D.

Both TRTX and VTMX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TRTX is the superior value option right now.

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TPG RE Finance Trust, Inc. (TRTX) : Free Stock Analysis Report

Corporacion Inmobiliaria Vesta, S.A.B. de C.V. Sponsored ADR (VTMX) : Free Stock Analysis Report

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

Zacks Investment Research

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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