QFIN or IBTA: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Technology Services sector might want to consider either Qifu Technology, Inc. QFIN or Ibotta IBTA. 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.
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 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, Qifu Technology, Inc. has a Zacks Rank of #1 (Strong Buy), while Ibotta has a Zacks Rank of #3 (Hold). This means that QFIN’s earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle 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.
QFIN currently has a forward P/E ratio of 6.40, while IBTA has a forward P/E of 311.16. We also note that QFIN has a PEG ratio of 0.44. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. IBTA currently has a PEG ratio of 8.18.
Another notable valuation metric for QFIN is its P/B ratio of 1.68. 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, IBTA has a P/B of 5.08.
These metrics, and several others, help QFIN earn a Value grade of A, while IBTA has been given a Value grade of D.
QFIN has seen stronger estimate revision activity and sports more attractive valuation metrics than IBTA, so it seems like value investors will conclude that QFIN is the superior option right now.
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