In celebration of March Madness, the Motley Fool is pitting 16 editor-selected companies in a fierce Stock Madness bracket. We will show you how the companies rank based on five key metrics, but your votes will determine the winner of each match-up.  

This matchup is Petroleo Brasileiro (NYSE: PBR) vs. Boeing (NYSE: BA). Using five short-of-scientific-but-carefully chosen criteria, let's determine which is the better buy according to the numbers:

 

Factor

Petroleo Brasileiro

Boeing

Cheapness

(P/E ratio)

16.2

38.5

Growth

(5-year growth rate)

26.9%

-.7%

Operations

(net margin %)

14.23%

1.96%

Balance Sheet

(debt/equity ratio)

.67

6.07

CAPS Rating

(scale of 1 to 5 stars)

5 Stars

3 Stars

Round 1: Cheapness

Advantage: Petroleo Brasileiro. Cheapness is determined by P/E ratio. The lower the better. Be careful of earnings near zero that skew the ratio, one-time gains and losses, and pasts that aren’t indicative of futures (the more dynamic the industry, the more this is true).

Round 2: Growth

Advantage: Petroleo Brasileiro. Growth here is the trailing 5-year EPS growth rate. This trailing earnings growth helps put notoriously-optimistic Wall Street projections in perspective.

Round 3: Operations

Advantage: Petroleo Brasileiro. Net margin percentage shows how efficiently a company turns revenue into profit. The more similar the business models, the more relevant the comparison.

Round 4: Balance sheet

Advantage: Petroleo Brasileiro. As with net margins, the debt to capital ratio is most relevant in comparing companies in similar industries. In this battle we give the nod to the lower-debt company, but attention should also be paid to the cost of debt, interest coverage ratios, and the stability of the business (the more stable a company’s operations, the more debt it can safely carry).

Round 5: CAPS rating

Advantage: Petroleo Brasileiro. A company’s CAPS rating is our community’s opinion of the stock. You can get more information on your stocks -- and our community’s opinions of those stocks -- by clicking over to CAPS area.

Each of these five rankings need more context to determine how these companies stack up against each other and bracket competitors General Electric (NYSE: GE) and Potash (NYSE: POT). But these basic numbers suggest that Petroleo Brasileirois a better buy. It’s up to you, though. Vote for the winner in the poll located below the bracket.