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GFSZY vs. AAXN: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Security and Safety Services sector have probably already heard of G4S PLC (GFSZY - Free Report) and Axon Enterprise . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, G4S PLC is sporting a Zacks Rank of #2 (Buy), while Axon Enterprise 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 GFSZY has an improving earnings outlook. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.

GFSZY currently has a forward P/E ratio of 11.01, while AAXN has a forward P/E of 52.70. We also note that GFSZY has a PEG ratio of 1.66. 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. AAXN currently has a PEG ratio of 2.11.

Another notable valuation metric for GFSZY is its P/B ratio of 3.59. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, AAXN has a P/B of 6.04.

Based on these metrics and many more, GFSZY holds a Value grade of A, while AAXN has a Value grade of F.

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


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