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ETWO or PYCR: Which Is the Better Value Stock Right Now?

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Investors interested in Internet - Software stocks are likely familiar with E2open Parent Holdings, Inc. (ETWO - Free Report) and Paycor HCM, Inc. (PYCR - 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

E2open Parent Holdings, Inc. and Paycor HCM, Inc. are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that ETWO's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

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.

ETWO currently has a forward P/E ratio of 21, while PYCR has a forward P/E of 26.75. We also note that ETWO has a PEG ratio of 1.39. 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. PYCR currently has a PEG ratio of 2.08.

Another notable valuation metric for ETWO is its P/B ratio of 0.90. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, PYCR has a P/B of 1.95.

These are just a few of the metrics contributing to ETWO's Value grade of B and PYCR's Value grade of D.

ETWO 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 ETWO is likely the superior value option right now.


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E2open Parent Holdings, Inc. (ETWO) - free report >>

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