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ASX vs. AMD: Which Stock Is the Better Value Option?

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Investors with an interest in Electronics - Semiconductors stocks have likely encountered both ASE Technology Hldg (ASX - Free Report) and Advanced Micro Devices (AMD - Free Report) . 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, ASE Technology Hldg has a Zacks Rank of #2 (Buy), while Advanced Micro Devices has a Zacks Rank of #3 (Hold). This means that ASX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

ASX currently has a forward P/E ratio of 6.27, while AMD has a forward P/E of 22.83. We also note that ASX has a PEG ratio of 0.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AMD currently has a PEG ratio of 0.81.

Another notable valuation metric for ASX is its P/B ratio of 1.34. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AMD has a P/B of 2.91.

Based on these metrics and many more, ASX holds a Value grade of A, while AMD has a Value grade of C.

ASX sticks out from AMD in both our Zacks Rank and Style Scores models, so value investors will likely feel that ASX is the better option right now.


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