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HLI vs. EEFT: Which Stock Should Value Investors Buy Now?

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Investors interested in Financial - Miscellaneous Services stocks are likely familiar with Houlihan Lokey (HLI - Free Report) and Euronet Worldwide (EEFT - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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.

Houlihan Lokey has a Zacks Rank of #2 (Buy), while Euronet Worldwide has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that HLI likely has seen a stronger improvement to its earnings outlook than EEFT has recently. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

HLI currently has a forward P/E ratio of 15.09, while EEFT has a forward P/E of 23.09. We also note that HLI has a PEG ratio of 1.20. 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. EEFT currently has a PEG ratio of 1.73.

Another notable valuation metric for HLI is its P/B ratio of 3.31. 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, EEFT has a P/B of 6.46.

These are just a few of the metrics contributing to HLI's Value grade of B and EEFT's Value grade of D.

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


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Euronet Worldwide, Inc. (EEFT) - free report >>

Houlihan Lokey, Inc. (HLI) - free report >>

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