AMG vs. SEIC: Which Stock Should Value Investors Buy Now?
AMG vs. SEIC: Which Stock Is the Better Value Option?
Investors with an interest in Financial - Investment Management stocks have likely encountered both Affiliated Managers Group (AMG) and SEI Investments (SEIC). But which of these two stocks presents investors with the better value opportunity right now? Let's 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Affiliated Managers Group has a Zacks Rank of #2 (Buy), while SEI Investments has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that AMG is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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.
AMG currently has a forward P/E ratio of 9.18, while SEIC has a forward P/E of 16.89. We also note that AMG has a PEG ratio of 0.57. 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. SEIC currently has a PEG ratio of 1.41.
Another notable valuation metric for AMG is its P/B ratio of 2.14. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, SEIC has a P/B of 4.79.
These metrics, and several others, help AMG earn a Value grade of A, while SEIC has been given a Value grade of C.
AMG has seen stronger estimate revision activity and sports more attractive valuation metrics than SEIC, so it seems like value investors will conclude that AMG is the superior option right now.
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Affiliated Managers Group, Inc. (AMG): Free Stock Analysis Report
SEI Investments Company (SEIC): Free Stock Analysis Report
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