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FORR vs. PRFT: Which Stock Is the Better Value Option?

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Investors interested in Computer - Services stocks are likely familiar with Forrester Research (FORR - Free Report) and Perficient (PRFT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Forrester Research is sporting a Zacks Rank of #2 (Buy), while Perficient has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that FORR has an improving earnings 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 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.

FORR currently has a forward P/E ratio of 11.31, while PRFT has a forward P/E of 20.42. We also note that FORR has a PEG ratio of 0.84. 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. PRFT currently has a PEG ratio of 1.70.

Another notable valuation metric for FORR is its P/B ratio of 1.36. 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, PRFT has a P/B of 4.68.

Based on these metrics and many more, FORR holds a Value grade of A, while PRFT has a Value grade of C.

FORR has seen stronger estimate revision activity and sports more attractive valuation metrics than PRFT, so it seems like value investors will conclude that FORR is the superior option right now.


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