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CGEMY or ADP: Which Is the Better Value Stock Right Now?
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Investors interested in Outsourcing stocks are likely familiar with Cap Gemini SA (CGEMY - Free Report) and Automatic Data Processing (ADP - 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.
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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on 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. But this is only part of the picture for value investors.
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 14.33, while ADP has a forward P/E of 27.30. We also note that CGEMY has a PEG ratio of 1.67. 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. ADP currently has a PEG ratio of 2.34.
Another notable valuation metric for CGEMY is its P/B ratio of 3. 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 29.38.
These are just a few of the metrics contributing to CGEMY's Value grade of B and ADP's Value grade of D.
CGEMY has seen stronger estimate revision activity and sports more attractive valuation metrics than ADP, so it seems like value investors will conclude that CGEMY is the superior option right now.
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CGEMY or ADP: Which Is the Better Value Stock Right Now?
Investors interested in Outsourcing stocks are likely familiar with Cap Gemini SA (CGEMY - Free Report) and Automatic Data Processing (ADP - 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.
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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on 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. But this is only part of the picture for value investors.
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 14.33, while ADP has a forward P/E of 27.30. We also note that CGEMY has a PEG ratio of 1.67. 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. ADP currently has a PEG ratio of 2.34.
Another notable valuation metric for CGEMY is its P/B ratio of 3. 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 29.38.
These are just a few of the metrics contributing to CGEMY's Value grade of B and ADP's Value grade of D.
CGEMY has seen stronger estimate revision activity and sports more attractive valuation metrics than ADP, so it seems like value investors will conclude that CGEMY is the superior option right now.