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CGEMY vs. ADP: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Outsourcing sector might want to consider either Cap Gemini SA (CGEMY - Free Report) or Automatic Data Processing (ADP - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Cap Gemini SA is sporting a Zacks Rank of #2 (Buy), while Automatic Data Processing has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CGEMY is likely seeing its earnings outlook improve to a greater extent. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
CGEMY currently has a forward P/E ratio of 15.46, while ADP has a forward P/E of 27.02. We also note that CGEMY has a PEG ratio of 1.79. 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. ADP currently has a PEG ratio of 2.25.
Another notable valuation metric for CGEMY is its P/B ratio of 3.19. 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, ADP has a P/B of 24.66.
Based on these metrics and many more, CGEMY holds a Value grade of A, while ADP has a Value grade of C.
CGEMY stands above ADP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that CGEMY is the superior value option right now.
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CGEMY vs. ADP: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Outsourcing sector might want to consider either Cap Gemini SA (CGEMY - Free Report) or Automatic Data Processing (ADP - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Cap Gemini SA is sporting a Zacks Rank of #2 (Buy), while Automatic Data Processing has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CGEMY is likely seeing its earnings outlook improve to a greater extent. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
CGEMY currently has a forward P/E ratio of 15.46, while ADP has a forward P/E of 27.02. We also note that CGEMY has a PEG ratio of 1.79. 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. ADP currently has a PEG ratio of 2.25.
Another notable valuation metric for CGEMY is its P/B ratio of 3.19. 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, ADP has a P/B of 24.66.
Based on these metrics and many more, CGEMY holds a Value grade of A, while ADP has a Value grade of C.
CGEMY stands above ADP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that CGEMY is the superior value option right now.