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CVG vs. PAYX: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Outsourcing sector might want to consider either Convergys or Paychex (PAYX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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, both Convergys and Paychex are holding a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.
CVG currently has a forward P/E ratio of 14.52, while PAYX has a forward P/E of 25.32. We also note that CVG has a PEG ratio of 1.94. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PAYX currently has a PEG ratio of 3.09.
Another notable valuation metric for CVG is its P/B ratio of 1.66. 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, PAYX has a P/B of 12.76.
These metrics, and several others, help CVG earn a Value grade of A, while PAYX has been given a Value grade of F.
Both CVG and PAYX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CVG is the superior value option right now.
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CVG vs. PAYX: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Outsourcing sector might want to consider either Convergys or Paychex (PAYX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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, both Convergys and Paychex are holding a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.
CVG currently has a forward P/E ratio of 14.52, while PAYX has a forward P/E of 25.32. We also note that CVG has a PEG ratio of 1.94. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PAYX currently has a PEG ratio of 3.09.
Another notable valuation metric for CVG is its P/B ratio of 1.66. 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, PAYX has a P/B of 12.76.
These metrics, and several others, help CVG earn a Value grade of A, while PAYX has been given a Value grade of F.
Both CVG and PAYX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CVG is the superior value option right now.