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ASOMY vs. MELI: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Internet - Commerce sector might want to consider either ASOS PLS ADR (ASOMY - Free Report) or MercadoLibre (MELI - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.

ASOS PLS ADR and MercadoLibre are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that ASOMY likely has seen a stronger improvement to its earnings outlook than MELI has recently. 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

ASOMY currently has a forward P/E ratio of 63.16, while MELI has a forward P/E of 1,201.80. We also note that ASOMY has a PEG ratio of 7.89. 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. MELI currently has a PEG ratio of 24.04.

Another notable valuation metric for ASOMY is its P/B ratio of 5.94. 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, MELI has a P/B of 65.61.

These metrics, and several others, help ASOMY earn a Value grade of B, while MELI has been given a Value grade of F.

ASOMY sticks out from MELI in both our Zacks Rank and Style Scores models, so value investors will likely feel that ASOMY is the better option right now.


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MercadoLibre, Inc. (MELI) - free report >>

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