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TLK or BCE: Which Is the Better Value Stock Right Now?

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Investors with an interest in Diversified Communication Services stocks have likely encountered both PT Telekomunikasi (TLK - Free Report) and BCE (BCE - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, PT Telekomunikasi has a Zacks Rank of #2 (Buy), while BCE has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that TLK likely has seen a stronger improvement to its earnings outlook than BCE has recently. But this is just one piece of the puzzle for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

TLK currently has a forward P/E ratio of 10.65, while BCE has a forward P/E of 15.21. We also note that TLK has a PEG ratio of 1.38. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BCE currently has a PEG ratio of 5.30.

Another notable valuation metric for TLK is its P/B ratio of 1.68. 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, BCE has a P/B of 2.47.

These metrics, and several others, help TLK earn a Value grade of B, while BCE has been given a Value grade of C.

TLK is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TLK is likely the superior value option right now.


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