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CRAI or HURN: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Consulting Services sector have probably already heard of CRA International (CRAI - Free Report) and Huron Consulting (HURN - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, both CRA International and Huron Consulting are holding a Zacks Rank of # 1 (Strong Buy). Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. 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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

CRAI currently has a forward P/E ratio of 16.93, while HURN has a forward P/E of 26.09. We also note that CRAI has a PEG ratio of 1.30. 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. HURN currently has a PEG ratio of 1.93.

Another notable valuation metric for CRAI is its P/B ratio of 2.06. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, HURN has a P/B of 2.63.

These are just a few of the metrics contributing to CRAI's Value grade of B and HURN's Value grade of C.

Both CRAI and HURN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CRAI is the superior value option right now.


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Charles River Associates (CRAI) - free report >>

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