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HURN vs. IT: Which Stock Is the Better Value Option?

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Investors with an interest in Consulting Services stocks have likely encountered both Huron Consulting (HURN - Free Report) and Gartner (IT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Huron Consulting and Gartner are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that HURN is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.

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 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.

HURN currently has a forward P/E ratio of 15.59, while IT has a forward P/E of 28.19. We also note that HURN has a PEG ratio of 1.15. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. IT currently has a PEG ratio of 2.65.

Another notable valuation metric for HURN is its P/B ratio of 1.78. 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, IT has a P/B of 9.46.

These metrics, and several others, help HURN earn a Value grade of B, while IT has been given a Value grade of D.

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


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Huron Consulting Group Inc. (HURN) - free report >>

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