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DTEGY vs. CHT: Which Stock Is the Better Value Option?

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Investors interested in Diversified Communication Services stocks are likely familiar with Deutsche Telekom AG (DTEGY - Free Report) and Chunghwa (CHT - 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.

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 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, Deutsche Telekom AG is sporting a Zacks Rank of #2 (Buy), while Chunghwa has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that DTEGY likely has seen a stronger improvement to its earnings outlook than CHT has recently. But this is only part of the picture for value investors.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

DTEGY currently has a forward P/E ratio of 14.51, while CHT has a forward P/E of 25.95. We also note that DTEGY has a PEG ratio of 1. 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. CHT currently has a PEG ratio of 18.67.

Another notable valuation metric for DTEGY is its P/B ratio of 1.40. 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, CHT has a P/B of 2.57.

Based on these metrics and many more, DTEGY holds a Value grade of A, while CHT has a Value grade of D.

DTEGY sticks out from CHT in both our Zacks Rank and Style Scores models, so value investors will likely feel that DTEGY is the better option right now.


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Chunghwa Telecom Co., Ltd. (CHT) - free report >>

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