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S vs. AQ: Which Stock Should Value Investors Buy Now?

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Investors interested in Wireless National stocks are likely familiar with Sprint (S - Free Report) and Aquantia . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, Sprint has a Zacks Rank of #2 (Buy), while Aquantia 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 S has an improving earnings outlook. 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.

S currently has a forward P/E ratio of 124.35, while AQ has a forward P/E of 919. We also note that S has a PEG ratio of 6.33. 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. AQ currently has a PEG ratio of 36.76.

Another notable valuation metric for S is its P/B ratio of 0.85. 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, AQ has a P/B of 3.32.

These metrics, and several others, help S earn a Value grade of A, while AQ has been given a Value grade of F.

S stands above AQ thanks to its solid earnings outlook, and based on these valuation figures, we also feel that S is the superior value option right now.


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