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ASX or AMBA: Which Is the Better Value Stock Right Now?
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Investors interested in Electronics - Semiconductors stocks are likely familiar with ASE Technology Hldg (ASX - Free Report) and Ambarella (AMBA - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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.
Currently, ASE Technology Hldg has a Zacks Rank of #1 (Strong Buy), while Ambarella has a Zacks Rank of #3 (Hold). This means that ASX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
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 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.
ASX currently has a forward P/E ratio of 9.94, while AMBA has a forward P/E of 121.60. We also note that ASX has a PEG ratio of 3.28. 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. AMBA currently has a PEG ratio of 8.53.
Another notable valuation metric for ASX is its P/B ratio of 1.12. 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, AMBA has a P/B of 3.56.
These metrics, and several others, help ASX earn a Value grade of A, while AMBA has been given a Value grade of F.
ASX stands above AMBA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ASX is the superior value option right now.
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ASX or AMBA: Which Is the Better Value Stock Right Now?
Investors interested in Electronics - Semiconductors stocks are likely familiar with ASE Technology Hldg (ASX - Free Report) and Ambarella (AMBA - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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.
Currently, ASE Technology Hldg has a Zacks Rank of #1 (Strong Buy), while Ambarella has a Zacks Rank of #3 (Hold). This means that ASX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
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 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.
ASX currently has a forward P/E ratio of 9.94, while AMBA has a forward P/E of 121.60. We also note that ASX has a PEG ratio of 3.28. 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. AMBA currently has a PEG ratio of 8.53.
Another notable valuation metric for ASX is its P/B ratio of 1.12. 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, AMBA has a P/B of 3.56.
These metrics, and several others, help ASX earn a Value grade of A, while AMBA has been given a Value grade of F.
ASX stands above AMBA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ASX is the superior value option right now.