III vs. ACN: Which Stock Is the Better Value Option?

ACN III

Investors with an interest in Consulting Services stocks have likely encountered both Information Services Group (III - Free Report) and Accenture (ACN - 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.

Information Services Group and Accenture are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that III's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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.

III currently has a forward P/E ratio of 21.01, while ACN has a forward P/E of 23.83. We also note that III has a PEG ratio of 1.50. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ACN currently has a PEG ratio of 2.31.

Another notable valuation metric for III is its P/B ratio of 3.18. 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, ACN has a P/B of 10.85.

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

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

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