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GLW vs. ANET: Which Stock Is the Better Value Option?

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Investors interested in Communication - Components stocks are likely familiar with Corning (GLW - Free Report) and Arista Networks (ANET - 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.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Corning and Arista Networks are both sporting a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.

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.

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.

GLW currently has a forward P/E ratio of 20.70, while ANET has a forward P/E of 43.63. We also note that GLW has a PEG ratio of 1.52. 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. ANET currently has a PEG ratio of 2.71.

Another notable valuation metric for GLW is its P/B ratio of 3.14. 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, ANET has a P/B of 13.82.

These metrics, and several others, help GLW earn a Value grade of B, while ANET has been given a Value grade of D.

Both GLW and ANET are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that GLW is the superior value option right now.


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