Back to top

Image: Bigstock

NTDTY or SWCH: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors interested in Technology Services stocks are likely familiar with Ntt Data Corporation (NTDTY - Free Report) and Switch . 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Ntt Data Corporation has a Zacks Rank of #2 (Buy), while Switch has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that NTDTY likely has seen a stronger improvement to its earnings outlook than SWCH has recently. 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.

NTDTY currently has a forward P/E ratio of 22.95, while SWCH has a forward P/E of 83.63. We also note that NTDTY has a PEG ratio of 2.87. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. SWCH currently has a PEG ratio of 5.58.

Another notable valuation metric for NTDTY is its P/B ratio of 2.29. 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, SWCH has a P/B of 3.03.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Ntt Data Corporation (NTDTY) - free report >>

Published in