HSBC vs. TD: Which Stock Is the Better Value Option?

Investors interested in stocks from the Banks - Foreign sector have probably already heard of HSBC (HSBC) and Toronto-Dominion Bank (TD). 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, HSBC is sporting a Zacks Rank of #2 (Buy), while Toronto-Dominion Bank has a Zacks Rank of #3 (Hold). This means that HSBC's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.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.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.HSBC currently has a forward P/E ratio of 8.81, while TD has a forward P/E of 11.34. We also note that HSBC has a PEG ratio of 1.10. 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. TD currently has a PEG ratio of 1.54.Another notable valuation metric for HSBC is its P/B ratio of 1.09. 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, TD has a P/B of 1.41.These metrics, and several others, help HSBC earn a Value grade of B, while TD has been given a Value grade of D.HSBC stands above TD thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HSBC is the superior value option right now.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report HSBC Holdings plc (HSBC): Free Stock Analysis Report Toronto Dominion Bank (The) (TD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks