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PERI vs. BCOV: Which Stock Is the Better Value Option?

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Investors with an interest in Internet - Content stocks have likely encountered both Perion Network (PERI - Free Report) and Brightcove (BCOV - Free Report) . 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Perion Network has a Zacks Rank of #2 (Buy), while Brightcove 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 PERI is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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 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.

PERI currently has a forward P/E ratio of 33.17, while BCOV has a forward P/E of 35.51. We also note that PERI has a PEG ratio of 2.21. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. BCOV currently has a PEG ratio of 2.37.

Another notable valuation metric for PERI is its P/B ratio of 2.94. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BCOV has a P/B of 5.49.

Based on these metrics and many more, PERI holds a Value grade of B, while BCOV has a Value grade of C.

PERI has seen stronger estimate revision activity and sports more attractive valuation metrics than BCOV, so it seems like value investors will conclude that PERI is the superior option right now.


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