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PRFT vs. FORR: Which Stock Should Value Investors Buy Now?

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Investors interested in Computer - Services stocks are likely familiar with Perficient (PRFT - Free Report) and Forrester Research (FORR - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Currently, both Perficient and Forrester Research are holding a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is just one factor that value investors are interested in.

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 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.

PRFT currently has a forward P/E ratio of 19.18, while FORR has a forward P/E of 27.54. We also note that PRFT has a PEG ratio of 1.60. 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. FORR currently has a PEG ratio of 2.30.

Another notable valuation metric for PRFT is its P/B ratio of 3.55. 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, FORR has a P/B of 3.83.

These metrics, and several others, help PRFT earn a Value grade of B, while FORR has been given a Value grade of C.

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


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Forrester Research, Inc. (FORR) - free report >>

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